Changes to charity accounting and reporting

Changes to the Charities SORP: New rules for charities preparing accruals accounts

If your charity prepares accruals accounts you must follow the Charities SORP (Statement of Recommended Practice). The Charities SORP has recently been updated, and SORP 2026 will apply to reporting periods starting on or after 1 January 2026.

 Key changes include:

·         Income and lease arrangements – new accounting rules with practical examples to help charities

·         Three new tiers to ensure reporting is more proportionate to the charity’s size:

·         Tier 1: Income up to £500,000

·         Tier 2: Income between £500,000 and £15 million

·         Tier 3: Income over £15 million

·         Trustees’ Annual Reports requirements have been refreshed with additional guidance on how to report financial reserves and plans about the future. There are also dedicated sections and guidance on areas that are of particular interest to the public and donors, including impact reporting, environmental, social and governance issues  

·         Social investments – simplified accounting and reporting requirements

·         Provisions and contingencies – easier to understand reporting requirements

For more details of the changes and to see the full SORP 2026 visit the Charity SORP website

Changes to accounts and examination requirements

Following a public consultation the Department for Culture Media and Sport (DCMS) has announced changes to accounting thresholds. These changes aim to reduce costs and administrative effort for smaller charities.

These changes are expected to come into effect on 30 September 2026 and apply to accounting years that end on or after 30 September 2026.

Requirement	Current threshold	New threshold (from 30 September 2026)
Accounts must be independently examined	Income over £25,000	Income over £40,000
Examination must be by a professionally qualified Independent Examiner	Income over £250,000	Income over £500,000
Non-company charities can choose to produce receipts and payments accounts	Income below £250,000	Income below £500,000
Accounts must be audited	Income over £1,000,000Assets over £3,260,000	Income over £1,500,000Assets over £5,000,000
Group accounts must be prepared and audited	Aggregate income of group £1,000,000	Aggregate income of group £1,500,000

Source: https://www.gov.uk/guidance/changes-to-charity-accounting-and-reporting

If you require any further information, please get in touch with Xaviers Accountants Limited

https://www.xaviersaccountants.co.uk/contact

Job Vacancy: Accounts / Audit Assistant

Description: Xaviers Accountants

We are a progressive firm of Chartered Certified Accountants in the North West.  We have developed a position as advisers to small and medium sized entrepreneurial businesses.

An opportunity has arisen to join our Preston based team.

We are looking to recruit an experienced candidate to support the team in delivering high quality, client focused and efficient accountancy and tax services. Our commitment to client service sets us apart from other providers of accountancy and taxation and you should be able to demonstrate your own commitment to service excellence.

Responsibilities include:

• Managing a portfolio of clients.

• Managing a team of trainees and experienced and qualified accountants.

• Preparing and presenting tender documentation for potential new work.

Required skills:

• Experienced AAT, ACA or ACCA part qualified individual.

• Experience in bookkeeping, Accounts preparation for SME entities and Charities, Taxation for companies and individuals

• Experience in SRA Audits, Charity Audits desirable

• Training and development of staff within the department and monitor their performance.

• Strong IT skills and experience of Sage 50 and Xero is essential.

• A full driving licence and access to a vehicle to attend client meetings

• Knowledge of languages - Hindi, Malayalam, Tamil desirable

In return, your skills will be developed rapidly in this professional and dynamic environment, and you will be provided with the opportunity to be part of a growing business, in an expanding department, with very good career development prospects.

Salary:

Salary dependent upon qualifications and experience.

Xaviers is committed to equality of opportunity for all staff and applications from individuals are encouraged regardless of age, disability, sex, gender reassignment, sexual orientation, pregnancy and maternity, race, religion or belief, and marriage and civil partnerships.

How to apply:

If you are interested in applying for this role, please email your CV along with a covering letter detailing your experience to info@xaviersaccountants.co.uk

HMRC gives Self Assessment taxpayers more time to ease COVID-19 pressures

HM Revenue and Customs (HMRC) is waiving late filing and late payment penalties for Self Assessment taxpayers for one month – giving them extra time, if they need it, to complete their 2020 to 2021 tax return and pay any tax due.

HMRC is encouraging taxpayers to file and pay on time if they can, as the department reveals that, of the 12.2 million taxpayers who need to submit their tax return by 31 January 2022, almost 6.5 million have already done so.

HMRC recognises the pressure faced this year by Self Assessment taxpayers and their agents. COVID-19 is affecting the capacity of some agents and taxpayers to meet their obligations in time for the 31 January deadline. The penalty waivers give taxpayers who need it more time to complete and file their return online and pay the tax due without worrying about receiving a penalty.

The deadline to file and pay remains 31 January 2022. The penalty waivers will mean that:

• anyone who cannot file their return by the 31 January deadline will not receive a late filing penalty if they file online by 28 February

• anyone who cannot pay their Self Assessment tax by the 31 January deadline will not receive a late payment penalty if they pay their tax in full, or set up a Time to Pay arrangement, by 1 April

Interest will be payable from 1 February, as usual, so it is still better to pay on time if possible.

https://www.gov.uk/government/news/hmrc-gives-self-assessment-taxpayers-more-time-to-ease-covid-19-pressures