New process to file charity accounts

Abbot111

Companies House have advised that from 1 April 2027, all companies will need to file their annual accounts using commercial software.  It appears that this includes micro-entities like mine (income <£10,000pa) who currently provide only 2 numbers each year -- gross income and gross expenditure.   

It looks like we shall need to buy and start to use a compliant software package from 1 April 2026 in order to comply with the 1 April 2027 deadline -- ie very shortly.  But I cannot find any guidance for micro-entity charities on how to go about this without the risk of falling foul of scammers or charlatans.   These processes are perhaps easy to adopt for a larger organisation with an experienced professional secretariat, but they are a major challenge for a small charity run by volunteers

Can anyone point me to help or guidance on this for small charities?  

Savvy_Sue

Do you have your accounts independently examined? If so, ask your examiner.

If not, I'd trust advice from https://iel.org.uk/

p00hsticks

Just seeking clarification for my own interest - do you really mean Companies House or are you referring to the Charity Commission ?

I ask as I'm also involved with a small charity run soley by volunteers, although with a bigger turnover that yours. We are only registered with the Charity commission, not set up as a limited company...   

On-the-coast

I’m in exactly the same position as @p00hsticks watching with interest. 

tacpot12

I'm the Treasurer for a Community Amateur Sports Club. We are entitled to file Micro Entiyty accounts, so I am indending to use Inform Direct: File Micro-Entity Accounts with Companies House Online – Inform Direct

This seems to allow me to continue to produce our accounts as before, but use Inform Direct to submit a set of abbreviated accounts for Companies House and a full set of accounts for HMRC in the required format (iXBRL). 

I'm not aware of any definitive guidance to small businesses/small charities on selecting software suppliers. You need to follow your usual due diligence process for selecting suppliers, but  overlay this with some knowledge of the risks posed by software supplier. Most small volunteer organisations will know someone that works in IT and knows how to assess the risk posed by software suppliers. If can't find anyone, you might need to do some googling, and perhaps post back here the name of any supplier you are considering used. You should also look for any reviews of the service you are considering using, and also check is there is online user group/forum.  

Savvy_Sue

p00hsticks said:

Just seeking clarification for my own interest - do you really mean Companies House or are you referring to the Charity Commission ?

I ask as I'm also involved with a small charity run soley by volunteers, although with a bigger turnover that yours. We are only registered with the Charity commission, not set up as a limited company...   

Many charities are both Ltd Co and Reg Charity. The ltd gives some protection to Trustees, who would also be Directors of the Ltd. 

Yorkie1

Savvy_Sue said:

p00hsticks said:

Just seeking clarification for my own interest - do you really mean Companies House or are you referring to the Charity Commission ?

I ask as I'm also involved with a small charity run soley by volunteers, although with a bigger turnover that yours. We are only registered with the Charity commission, not set up as a limited company...   

Many charities are both Ltd Co and Reg Charity. The ltd gives some protection to Trustees, who would also be Directors of the Ltd. 

That's interesting; just to clarify, though, does this new reporting requirement apply to charities which are only registered with the Ch Comm - i.e. which are not a Ltd Co, CIO, etc.? 

Savvy_Sue

Yorkie1 said:

Savvy_Sue said:

p00hsticks said:

Just seeking clarification for my own interest - do you really mean Companies House or are you referring to the Charity Commission ?

I ask as I'm also involved with a small charity run soley by volunteers, although with a bigger turnover that yours. We are only registered with the Charity commission, not set up as a limited company...   

Many charities are both Ltd Co and Reg Charity. The ltd gives some protection to Trustees, who would also be Directors of the Ltd. 

That's interesting; just to clarify, though, does this new reporting requirement apply to charities which are only registered with the Ch Comm - i.e. which are not a Ltd Co, CIO, etc.? 

As I understand it, you're potentially dealing with two separate sets of requirements, which are similar but not identical. 

If you are registered as a Charity, you must meet all requirements of the Charity Commission. If you are not also a Ltd Co (or some other kind of legal entity), you can safely ignore any requirements which apply to them. 

If you are registered as a Ltd Co, you must meet all requirements of Companies House. If you are not also a registered charity (which most won't be, of course), you can safely ignore the requirements of the CC. 

I have only ever known accounts to be filed with the Charity Commission through an online portal, so I don't know if there's any other way of doing it, or if that is a requirement. 

The Companies House filing requirements are related to HMRC ensuring you've paid enough tax. The Charity Commission requirements are to ensure that you are keeping the necessary records, complying with your charitable purposes, and enabling the public to check what you've been up to. 

Yorkie1

Thanks for the reply. I assist a couple of small charities who are not registered with Companies House and file reports with the CC that are simple enough.

Nigh

"As I understand it, you're potentially dealing with two separate sets of requirements, which are similar but not identical.

If you are registered as a Charity, you must meet all requirements of the Charity Commission. If you are not also a Ltd Co (or some other kind of legal entity), you can safely ignore any requirements which apply to them. 

If you are registered as a Ltd Co, you must meet all requirements of Companies House. If you are not also a registered charity (which most won't be, of course), you can safely ignore the requirements of the CC."

Savvy_Sue I can offer another permutation. I volunteer for a local group which is a limited company. We are wholly owned by another local group which is a registered charity. Years ago, we were a registered charity but this was changed as it was felt that we did not strictly conform to the Charity Commission rules in that, the monies we raise do not go directly to charity. Instead they are used to provide a service for the charity company.

I'm currently searching to find the best way for us to file our accounts.

Savvy_Sue

I'd go with a strict understanding. You are a limited company: follow their requirements. Pass these accounts to the 'owner' and allow them to do what's needed with the charity commission.

But I'm no expert …

And, if you have an accountant or Independent Examiner, ask for and follow their advice.