The Charity Annual Return 2023 includes several new compulsory questions.
The purpose of the additional questions is to enable the Charity Commission to gather specific data to inform key areas, including income, expenditure, organisational structures, staffing, governance and risk.
This updated version of the Annual Return applies to charities’ financial years ending on or after 1 January 2023 and must be completed by registered charities with annual income above £10,000 and all charitable incorporated organisations.
Specific criteria apply to some of the new questions and therefore not every charity is obligated to answer all questions.
Below is an overview of the new questions included within the Annual Return 2023.
Income breakdown
Applies to
Charities with a gross income of £500,000 or less in the financial period for this return and with grants or contracts that represent less than 70% of the charity’s income.
Information required
Total value of income received during the financial period of this return from donations and legacies; charitable activities; other trading activities; and investments.
Reason for the question
To identify if a charity is susceptible to risks associated with reduced income or other economic changes.
Donations
Applies to
Charities with a gross income over £100,000 in the financial period for this return.
Information required
Value of the single highest donation received from a corporate donor, individual donor and related party during the financial period of the return.
Reason for the question
To gain an increased understanding of financial dependency to make it easier to detect potential conflicts of interest.
Grant making
Applies to
Charities whose main way of carrying out its charitable purposes is making grants to individuals or organisations.
Information required
The total value of grants made to individuals; other charities; and other organisations that are not charities.
Reason for the question
To determine financial risk and provide early identification of any wider financial instability in the charity sector.
Spending outside the United Kingdom
Applies to
Charities spending funds outside of the United Kingdom in the financial period of this return.
Information required
Total amount of money sent outside of the UK using a method other than the regulated banking system and details of how this money was transferred.
Reason for the question
To promote compliance with trustees’ legal obligations and to provide the Commission with early identification of new forms of transfer.
Trading subsidiaries
Applies to
Charities with trading subsidiaries
Information required
Details of any trading subsidiaries that have that have dissolved during the financial period of the return.
Reason for the question
Provides an indicator of risk to the ongoing operations of a charity.
Charity addresses
Applies to
All charities
Information required
Confirmation that a charity’s address is the same as the one displayed on the Register of Charities.
Reason for the question
To increase accountability by ensuring that the Register is up to date and to help understand any connections between charities and organisations.
Property
Applies to
Unincorporated charities.
Information required
Details of any properties held by holding or custodian trustees on behalf of the charity.
Reason for the question
To help assess property at risk, promote compliance with charity law and seek to prevent the number of disputes affecting charity assets.
Structure and membership
Applies to
All charities
Information required
Details of whether a charity is part of a wider group structure with a parent and subsidiary body. Information on any members who are entitled to vote under the charity’s governing document.
Reason for the question
To identify and help prevent common risks across certain categories or groups of charities.
Employees
Applies to
All charities
Information required
The number of people permanently employed; on fixed-term contracts; and self-employed and the total amount spent on employee payroll.
Reason for the question
To understand how and where people are employed within the charity sector and increase transparency and public trust.
Governance
Applies to
All charities (except subsidiary charities)
Information required
Specifics on the policies and procedures in place at the end of the financial return.
Reason for the question
To encourage the effective administration of charities.
Safeguarding
Applies to
All charities
Information required
Details of any services provided to children and/or adults at risk
Reason for the question
Identify charities with higher safeguarding risk and provide proactive communications and guidance.
For any advice on the Charity Annual Return 2023, or guidance on the new questions please get in touch with your usual M+A Partners contact or contact me directly using the details below.
