In most jurisdictions, part of the definition of a not-for-profit (of which a charity is a more restricted subset) is that it doesn’t exist for the benefit of the members / shareholders, or a specific person.
So creating a charity / NFP and asking people to pay into it is usually okay, but the purpose of that charity can’t be to enrich you, and it is a separate legal identity (i.e. taking a charity’s funds and giving it to yourself would be embezzling). Many jurisdictions allow for sports clubs to exist as not-for-profits, but they’d generally need to be for the purpose of organising a whole team to practice, compete and so on.
Generally charities can employ people to do work for them and pay them, but (varies by jurisdiction) they generally need to be not paid above a fair market rate for the work they actually do to advance the goals of the charity.
If the goal is to help a legitimate cause, you could also ask them to donate to an existing not-for-profit for the cause.
Disclaimer: IANAL, and anyway all of this would vary by jurisdiction - not legal advice!
Look, you can keep pointing out obvious loopholes and people can keep answer with increasingly obscure examples of laws or of people getting convicted trying just that until the cows come home, but that’s missing the bigger picture.
The rich don’t want people to get rich easily. For legal loopholes to go unpatched, they have to be complicated enough that politicians can plausibly deny blame and they have to require enough wealth to begin with that rich people see it as a tool rather than as a threat. Or they have to be something that has genuinely escaped notice so far despite millions of people searching for it. A lay person free-associating from nothing is very unlikely to come across something that hasn’t been tried yet.
In most jurisdictions, part of the definition of a not-for-profit (of which a charity is a more restricted subset) is that it doesn’t exist for the benefit of the members / shareholders, or a specific person.
So creating a charity / NFP and asking people to pay into it is usually okay, but the purpose of that charity can’t be to enrich you, and it is a separate legal identity (i.e. taking a charity’s funds and giving it to yourself would be embezzling). Many jurisdictions allow for sports clubs to exist as not-for-profits, but they’d generally need to be for the purpose of organising a whole team to practice, compete and so on.
Generally charities can employ people to do work for them and pay them, but (varies by jurisdiction) they generally need to be not paid above a fair market rate for the work they actually do to advance the goals of the charity.
If the goal is to help a legitimate cause, you could also ask them to donate to an existing not-for-profit for the cause.
Disclaimer: IANAL, and anyway all of this would vary by jurisdiction - not legal advice!
So then wait. So why not just make a charity, then employ myself as manager or something.
Look, you can keep pointing out obvious loopholes and people can keep answer with increasingly obscure examples of laws or of people getting convicted trying just that until the cows come home, but that’s missing the bigger picture.
The rich don’t want people to get rich easily. For legal loopholes to go unpatched, they have to be complicated enough that politicians can plausibly deny blame and they have to require enough wealth to begin with that rich people see it as a tool rather than as a threat. Or they have to be something that has genuinely escaped notice so far despite millions of people searching for it. A lay person free-associating from nothing is very unlikely to come across something that hasn’t been tried yet.
Such a stunt is usually done with a “foundation” instead of a normal charity.
Depending on your legislation, this may indeed become a loophole to receive donations and avoid taxes.
In most countries charities have reporting requirements and rules to follow to stop exactly this method of fraud.