Navigating Charity Compliance

a man standing on an orange path navigating charity compliance

Navigating Charity Compliance

There are charities for all kinds of issues and causes, from local to global, but all of them must comply to strict regulatory framework that governs their activities.

The UK charitable sector is one of the largest and most vibrant in the world. It delivers a range of services to individuals and communities both here and overseas, often filling in the gaps where other services fail.

What is charity compliance?

In the UK, the Charity Commission in England & Wales, the Scottish Charity Regulator, and the Charity Commission for Northern Ireland oversees the activities of over 160,000 charities. They are responsible for ensuring that all charities are correctly registered and are being run correctly. They do this by conducting regular audits.

A charity’s trustees are responsible for ensuring it is compliant and for communicating with their national regulator as required.

What are the charity compliance requirements?

Charities’ compliance covers several areas. These include:

Registration

Every charity must register with its national regulator to receive official recognition of charitable status. This secures access to tax benefits, including exemptions and reduced rates on income tax, capital gains tax, and inheritance tax.

Governance

Charities must appoint a board of trustees with responsibility for overseeing the organisation’s activities and ensuring legal compliance. Every trustee has a legal duty to act in the best interests of the charity and to avoid potential conflicts of interest.

Financial Management

Sound financial management is at the heart of charity compliance due to its role in ensuring public confidence in the charity and the wider sector. Charities are required to maintain accurate accounting records that reflect their income, expenditure, and assets. These should be prepared in accordance with accounting standards and be able to withstand scrutiny. Charities with an income of over £25,000 are required to have their accounts independently audited.

Fundraising

Regulations and guidelines regulate how charities raise funds. These are set out by the Fundraising Regulator to ensure transparency in fundraising communications, obtaining consent from donors, and ensuring that personal data is handled in accordance with data protection laws.

Data Protection

Charities are subject to data protection laws when handling personal data, including the General Data Protection Regulation (GDPR). Appropriate policies and procedures must be in place to handle personal information securely and obtain necessary consents for data processing. Any data breaches must be responded to promptly and effectively.

Reporting

Annual reports and accounts must be submitted to the appropriate regulatory body. These will be available to the public. Reports provide an overview of the charity’s financial performance, activities, achievements, and governance structure. Reporting helps strengthen transparency, allowing stakeholders and the wider public to assess the organisation’s performance.

How Wilder Coe can help you successfully navigate charity compliance

At Wilder Coe, we understand the unique challenges that charities face in raising money and delivering services while remaining compliant. We work with many charitable organisations and social enterprises to improve their operations, remain compliant, and maximise their impact in a complex environment.

Contact our experienced team to find out more about our bespoke services for charities and social enterprises today.

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Charlotte Willmore
Audit Manager at Wilder Coe
Charlotte has experience in the supervision and preparation of statutory accounts, management accounts including tailored client-specific analysis and service charge accounts as well as the audit of statutory accounts and preparation of Corporation tax returns for companies.