© Crown copyright 2014
This publication is licensed under the terms of the Open Government Licence v3.0 except where otherwise stated. To view this licence, visit nationalarchives.gov.uk/doc/open-government-licence/version/3 or write to the Information Policy Team, The National Archives, Kew, London TW9 4DU, or email: email@example.com.
Where we have identified any third party copyright information you will need to obtain permission from the copyright holders concerned.
This publication is available at https://www.gov.uk/government/publications/excepted-charities/excepted-charities--2
1. What excepted charities are
Some charities are ‘excepted’ from charity registration. This just means they don’t have to register or submit annual returns. Apart from that, the Charity Commission regulates them just like registered charities and can use any of its powers if it needs to.
A charity is excepted if its income is £100,000 or less and it is in one of the following groups:
- churches and chapels belonging to some Christian denominations (see section 5)
- charities that provide premises for some types of schools (see section 9)
- Scout and Guide groups (see section 10)
- charitable service funds of the armed forces (see section 11)
- student unions (see section 12)
In practice, some of these charities’ income is below £5,000, the normal threshold for registration, so they wouldn’t have to register anyway.
They are different from exempt charities, which are exempt from registration and regulation by the commission.
2. How charity law applies to excepted charities
Apart from not having to register or make annual returns, excepted charities must comply with charity law. Their trustees have the same responsibilities as trustees of any other charity.
3. How charities become excepted
Before 2009, Parliament or the commission could make regulations to ‘except’ charities. No new exceptions can now be made, apart from for charities that cease to be exempt charities.
4. Duration of exceptions
Most exceptions are permanent; only one is for a fixed time. The exception for church charities has now been extended to 31 March 2021. This is to give the commission and denominational bodies time to help these churches prepare for registration by, or soon after, March 2021 (when the exception will end).
The commission is not ready to accept voluntary registrations yet; it will publish more information about this when it has made the necessary arrangements.
See the new regulations extending the 1996 regulations.
(There is a link to the 1996 regulations at the end of this guidance.)
5. Church charities
Churches and other charities that are wholly or mainly for public religious worship linked to any of the following bodies are excepted if their income is £100,000 or less:
- Baptist churches including:
- Association of Grace Baptist Churches East Anglia
- Association of Grace Baptist Churches South East
- Association of Grace Baptist Churches West Anglia
- Baptist Union of Great Britain
- Baptist Union of Wales
- Gospel Standard Trust
- Grace Baptist Trust Corporation
- Old Baptist Union
- Church in Wales
- Church of England
- Congregational churches including:
- Congregational Federation
- Evangelical Fellowship of Congregational Churches
- Fellowship of Independent Evangelical Churches (FIEC)
- General Assembly of Unitarian and Free Christian Churches
- Methodist Church
- Calvinistic Methodist or Presbyterian Church in Wales
- Religious Society of Friends
- Union of Welsh Independents
- United Reformed Church
Charities linked to other faith bodies must register if their income is more than £5,000.
If an excepted church charity changes to a CIO, it will no longer be excepted and must register (see section 13).
6. Churches which are no longer excepted
The following groups of local churches used to be excepted, but are not in the current (1996) excepting regulations:
- The Church of the Nazarene
- The Free Church of England
- Independent Methodists
- Wesleyan Reformed Union
- Churches of Christ
Any churches with income over £5,000 belonging to one of these groups that are not registered will need to register with the commission and should contact their denominational body for further advice.
7. Buildings that are registered places of worship
Registered places of worship under the Places of Worship Registration Act 1855 are excepted. This exception only applies to buildings, not to any funds.
So if a charity that includes a registered place of worship has income of more than £5,000 per year it must normally register, unless another exception applies.
8. Local Ecumenical Partnerships (LEPs)
LEPs involve two or more Christian denominations working together under a formal agreement. If any of the member churches in a LEP is excepted then the LEP is excepted.
9. Charities for school premises
A charity is excepted if it:
- holds land and buildings on trust for use as or by a school, and
- has no other source of income
These charities are usually called foundations. Foundations created under the School Standards and Framework Act 1998 are exempt charities.
These school foundation charities are usually linked to, but independent of, a charity that runs the school on their premises. The charity that runs the school is likely to be an exempt charity. See the commission’s guidance for school governors for more information about the types of schools that might be linked to an excepted foundation charity.
10. Scout and Guide groups
Scout and Guide groups are excepted unless:
- their income is more than £100,000, or
- they have permanent endowment, or
- they own land or buildings
A Scout or Guide charity that has permanent endowment or owns a building must register if its income is more than £5,000.
11. Charities for the armed forces
Charities that are wholly or mainly for promoting the efficiency of any of the armed forces of the Crown are excepted, unless:
- their income is more than £100,000, or
- they own land (other than a tenancy), or
- they benefit people who are not serving members of the armed forces, or
- their objects include the exhibition or preservation of articles of historic interest
These charities are known as service funds. Administrators or trustees of these funds who need further information should get in touch with their respective service contact:
Royal Navy and Royal Marines
RN: Fleet Charities Unit
Mail Point 1.3
RM Corps Secretariat
SA Pensions and Service Funds
Royal Air Force
SO2 Service Funds Policy
Headquarters Air Command
Royal Air Force High Wycombe
Unregistered charities that promote the efficiency of the armed forces and which are not treated as service funds should contact the commission to confirm if they are required to register.
12. Smaller student unions
Student union charities whose annual income is below £100,000 are excepted.
13. If your charity may need to register
If you think your charity needs to register, you will need to complete a full application and explain why the excepting regulations do not apply. You must explain how the charity will further charitable purposes for the public benefit.
Read the commission’s guidance on how to register your charity.
14. How to change an excepted charity to a CIO
Some excepted charities may be able to change and become a CIO, but they would then stop being excepted, and have to be a registered charity. This is because a CIO can only exist when it is registered by the commission. In most cases this would involve setting up a new CIO to take over the assets and operations of the excepted charity.
Some types of excepted charity may be unable to change to a CIO. For example, Parochial Church Councils of the Church of England (PCCs) are governed by ecclesiastical law. A CIO could not simply replace a PCC. The constitutions of local Scout and Guide groups are set under the Royal Charters of Scouts and Girlguiding UK.
A local church charity set up under a trust deed or constitution could transfer its property and operations to a new CIO. However, the commission would suggest that each denomination should decide whether they think this to be appropriate for their local churches. They may, for instance, want to agree a model constitution with the commission.
15. The legal framework - links to acts and regulations for excepted charities
Scouts and Guides
Armed Forces charities
Student Unions (charities that ceased to be exempt in 2010)
(In practice this regulation only affected smaller student unions.)