Leasing a Church or Hall Roof for Solar: the Charity Rules

A local energy group offers to fund the whole array. They own the panels, you host them, the building gets cheaper electricity and nobody has to find £30,000. It is one of the genuinely good models in community renewables, and it is how a lot of church and hall solar gets built.

It is also a property transaction, and if your building is held by or in trust for a charity, the law has something to say about it before the roof does. This post sets out the steps in the order trustees have to take them. For the wider position on VAT, planning and grid connection, see our guide to charity solar rules.

It assumes England and Wales. Scotland and Northern Ireland have their own charity land regimes and the sections below do not apply there.

Step 1: work out whether you are disposing of land at all

Three structures, three different answers.

The charity buys the system. No disposal, no charity land question. Grant programmes generally like this, because they are funding an asset the charity will own.

A third party owns the system and sells you the electricity. A power purchase agreement. You are buying energy, not disposing of land — though the agreement will usually include rights over the roof that need looking at, and most capital grants will not fund it precisely because you end up owning nothing. Our PPA guide covers this model.

A third party owns the panels and leases your roof. This is a disposition of charity land, and it is the structure most community energy schemes use. Everything below applies.

Step 2: know the default rule

For charities in England and Wales, section 117 of the Charities Act 2011 sets the default: a disposition of charity land requires an order of the court or the Charity Commission. That sounds prohibitive, and it is not meant to be — Parliament also provided a statutory route that trustees can follow instead, without applying for an order. Most roof leases go down that route.

But it is a route with conditions, and if you cannot satisfy them you are back to needing the order. So check the conditions before you agree terms, not after.

Step 3: check the connected-person rule first

Of everything in this post, do this one first, because it is the only condition that can shut the statutory route entirely.

Section 118 deals with disposals to a connected person. The definition is broad: a charity trustee, a person connected with a trustee (close family and so on), the charity’s officers and employees, and any company or institution that those people control or in which they hold a substantial interest.

Now consider how community energy actually works in a village. The hall committee and the energy society are drawn from the same forty people who turn up to things. The society’s chair is a trustee of the hall. Two of the hall’s trustees put seed money into the society’s share offer. None of that is improper — it is what community organisation looks like — but it can make the society a connected person, and where it does, the statutory route is not available and you will need a Commission order.

Work this out before heads of terms are drafted. Finding it afterwards means either restructuring who sits where, or a Commission application nobody built into the programme.

Step 4: get the right advice, from the right person

If the other party is not a connected person, the second condition is advice.

For a lease of more than seven years, section 119 applies: before agreeing terms, the trustees must obtain and consider written advice on the proposed disposition from a designated adviser.

For a lease of seven years or less, section 120 applies a lighter requirement.

A lease meant to last the working life of a solar array will normally run well beyond seven years — twenty to twenty-five is typical — so plan on section 119 unless there is a specific reason not to.

Here is the part where older guidance will mislead you. It used to be that the advice had to come from a qualified surveyor, and a great deal of church and village hall guidance still says so. The Charities Act 2022 replaced that requirement with the designated adviser concept and widened the pool. As well as RICS members, fellows of the Central Association of Agricultural Valuers and fellows of NAEA Propertymark can give the advice — and, significantly for small charities counting every pound, a trustee or employee of the charity who meets the criteria can now give it in-house.

The same Act removed the old requirement to advertise the disposition as the adviser directed. If someone tells you that you must advertise a roof lease, they are working from the pre-2023 position.

None of that dilutes the duty. The trustees must still obtain the advice and consider it, and minute that they did. An adviser’s report filed unread satisfies nothing.

Step 5: read the lease for the things that outlive everyone signing it

A roof lease is a long document about a building you are responsible for. Some points that matter more than the rent:

• Access rights. Who gets onto the roof, when, with what notice, and who makes good afterwards.
• Repairs interaction. If you need to re-slate the slope in year twelve, who removes and refits the panels, and who pays? This is the clause trustees most often wish they had read, particularly on an older building with a quinquennial inspection due.
• End of term. Who removes the array and restores the roof, and what happens if the society has dissolved by then.
• Insurance. Whose policy covers the panels, and does your insurer know they are there.
• Assignment. Can the society transfer the lease, and to whom. “A local community group” and “whoever buys the assets in ten years” are different propositions.

Step 6: keep the grant question in view

If any part of the project is grant-funded, settle ownership before applying. Programmes that fund assets expect the charity to own the asset, and a structure where someone else owns the panels will usually not qualify. Deciding this early is straightforward; reconciling a signed lease with a funder’s conditions afterwards is not. Our grants and funding guide sets out what is currently open and what each route requires.

One more sequencing point worth making, because it changes the numbers: establish the VAT position before you compare a lease against buying outright. Installing solar is zero-rated for VAT in a building used solely for a relevant charitable purpose until 31 March 2027, so the cost of the charity buying the system may be lower than a quote based on older assumptions suggests — which can make outright purchase more attractive than it first looked.

The short version

1. Identify the structure — purchase, PPA or roof lease. Only the third engages the charity land rules.
2. Check connected persons under section 118 first. It is the only thing that can close the statutory route.
3. For a lease over seven years, obtain and consider written advice from a designated adviser under section 119 — which no longer has to be a chartered surveyor, and no longer requires advertising.
4. Read the access, repair and end-of-term clauses as carefully as the rent.
5. Fix the ownership model before you apply for a grant.

The full sequence, including the planning route under Class J, the G98 and G99 connection thresholds and the VAT tests, is on our charity solar rules page. This post is general guidance on published rules as at September 2026, not legal advice on your building — a roof lease is a long-term disposal of a charity asset, and it is worth the cost of proper advice.