What Are The Charity Commission Filing Obligations For My Charity? Part 1: The Annual Return

• Published date: 14 January 2021
• Subject Matter: Corporate/Commercial Law, Charities & Non-Profits , Corporate and Company Law
• Law Firm: Wrigleys Solicitors
• Author: Ms Hayley Marsden and Daniel Lewis

A closer look at your charity's obligation to file an annual return.

A number of factors determine the reporting and accounting obligations a charity owes to the Charity Commission, including the charity's legal status, whether it is exempt from registration and the charity's gross annual income. This series of articles specifically looks at the reporting and accounting obligations of registered charities and does not consider the further obligations on charitable companies under the Companies Act 2006.

Unless it is an exempt or excepted charity, a charity must register with the Charity Commission if it has an annual income greater than '5,000. All registered charities must file an Annual Return, with the questions varying depending upon the income of the charity. All charities must also prepare an Annual Trustees' Report and Annual Accounts, with charitable incorporated organisations (CIOs) and those with a gross income of more than '25,000 being required to submit these to the Charity Commission. In all cases, the filings must usually be submitted within ten months of the registered charity's financial year end.

However, during the Covid-19 pandemic, the Charity Commission is seeking to take a more flexible approach to regulation. As such, registered charities can contact the Charity Commission to request a three-month filing extension for submission of the Annual Return - though success is not guaranteed¹.

It is common for trustees to delegate the preparation and submission of the above documents. However, the Commission is generally subjecting charities to a greater degree of overall scrutiny and it is therefore important that charity trustees, given their ultimate responsibility, check and approve all documents before their final submission and to ensure all the information submitted is accurate and up to date.

The Annual Return

The Charity Commission published a new Annual Return in November 2018, with new questions on overseas funding, staff salaries and the safeguarding of children and vulnerable adults. These new questions reflect greater scrutiny of charities and the additional information provided (such as the number of staff members receiving pay of above '60,000) now feeds directly into the public Register of Charities. This in turn provides the public with more information on how charities operate and places the onus on trustees to ensure the information submitted to the Charity Commission as part of the Annual Return is accurate. In line...