Correspondence

Charity Commission News: Issue 62

Updated 30 January 2019

Applies to England and Wales

We email CC news to charity contacts and trustees because it contains essential regulatory information that they need to be aware of. Charity trustees may also be known as directors, board members, governors or committee members.

Check and update your charity details before submitting the annual return

Before you can submit your annual return you will need to check all your charity details are correct on the register, and update them if needed.

For accounting periods ending on 31 March 2018, the deadline for submitting your 2018 return is 31 January 2019. Start updating your details as early as possible to avoid submitting your annual return late.

The first time you log in to do your annual return the service will guide you through 6 screens that show all your charity details. You will need to update any details that are not correct and then you can submit your annual return.

Find out more about this change and what information is covered in the service.

If you need help to prepare an annual return our guidance explains what you need to do.

Changes to public display names on the charity register

As part of changes to our online services, if current trustees have used a public display name on the charity register their full legal name will be displayed to the public from the 1 April 2019, unless they apply to have it removed. This is known as a dispensation.

We can grant a dispensation if displaying a legal name to the public could put the relevant person or people in personal danger. Dispensations will not be granted automatically.

Find out about display name changes and how to apply for a dispensation.

If trustees have already been granted a dispensation for their legal name not to be displayed to the public on the register, this will be retained. There will be no need to apply for a dispensation again.

Quality and transparency has fallen in charity accounts

Our recent review of charity accounts has found that just over half of charities are meeting the public benefit reporting requirements.

Just 70% of trustees’ annual reports and accounts in the public reporting review met the basic benchmark of user requirements.

The quality benchmark was based on recent research into trust in charities which found that ‘ensuring a reasonable proportion of donations make it to the end cause’ and ‘making a positive difference to the cause they work for’ were the most important factors for public trust and confidence in charities.

The main reasons why charities’ accounts submissions did not meet the basic benchmark were:

• failure to evidence that accounts had been subject to independent scrutiny by an auditor or independent examiner, as required by law
• not providing meaningful information about their charity’s purposes or the activities carried out to achieve those purposes

Also, just 52% of trustees’ annual reports in the public benefit reporting review met the public benefit reporting requirements.

Trustees are falling short on the requirements to explain activities carried out by the charity to further its purposes for the public benefit, and to provide a public benefit statement.

It is important that you explain the activities your charity undertakes and the impact you have. We want to see charity thrive, so charities must be clearer about who they help and what difference they are making.

Charities should get ready for Making Tax Digital for Value Added Tax (MTD VAT)

For VAT periods starting on or after 1 April 2019, most VAT registered entities with taxable turnover above the VAT threshold (£85,000) will need to keep their records digitally and send their VAT return data to HM Revenue and Customs (HMRC) using MTD-compatible software.

The exception is a small minority of VAT registered entities with more complex requirements. For these the MTD rules will apply from 1 October 2019.

You can prepare by:

• looking at how you can keep your records digitally, if you do not already
• asking your software provider if you currently use commercial accounting software about when it will be MTD-compatible
• (for more complex charities) looking at your internal operations to make sure your end-to-end process is digital
• joining the MTD VAT pilot as soon as you can

Find out more about Making Tax Digital for VAT on the HMRC website. If you have any queries about this please contact HMRC.

The importance of safeguarding and protecting people

Safeguarding is a key governance priority for all trustees, not just those working with groups traditionally considered at risk.

You should read the guidance about safeguarding duties for charity trustees which was recently updated.

We advise you to carry out a thorough review of your charity’s safeguarding governance and management arrangements and performance, if you haven’t done in the last 12 months.

It is also important that you contact us about any safeguarding issues, or serious safeguarding incidents, complaints or allegations which have not previously been reported to us.

Find out about reporting serious incidents in your charity as a trustee.

Find out about reporting serious wrongdoing at a charity as a worker or volunteer.

Keeping in touch with us

From the 31 March 2019 our email addresses will be changing, they will no longer have .gsi in the address. We will update all email addresses on our website in time for this change.

Our contact centre is open 10am to 12noon and 1pm to 3pm, Monday to Friday on 0300 066 9197. We can help if you are experiencing technical problems with an annual return, a registration application or any of our online forms.

You can also sign up for GOV.UK email alerts. This is the simplest way to keep up-to-date with the latest information we publish on our website. You’ll be asked for an email address to create a subscription, and can choose how often you’d like to be alerted.

It is also useful to follow us through our social media channels Twitter and LinkedIn. We regularly share important information and updates for the charity sector.