Charity accounting thresholds change in September: check yours
Charities in England and Wales have a practical date to add to the diary. New accounting and examination thresholds come into force on 30 September 2026 and apply to accounting years ending on or after that date.
The change could reduce the level of external scrutiny required for some smaller charities. Trustees still need good records, annual accounts and a trustees' annual report. The useful step now is to identify which rules will apply at your next year end.
Start with your accounting year end
The effective date is tied to the end of your accounting year. A charity with a year ending on 31 August 2026 remains under the current thresholds for that set of accounts. A year ending on 30 September 2026 falls under the new thresholds.
This is separate from the new Charities SORP 2026, the reporting standard for charities preparing accruals accounts. SORP 2026 applies to reporting periods starting on or after 1 January 2026.
Check the thresholds that affect your charity
The Charity Commission's current summary sets out the main changes:
- Independent examination will be required when annual income is over £40,000, up from £25,000.
- A professionally qualified independent examiner will be required when income is over £500,000, up from £250,000.
- A non-company charity will be able to choose receipts and payments accounts when income is below £500,000, up from £250,000.
- The main audit income threshold will rise from over £1 million to over £1.5 million. The related asset test and group-accounts threshold will also increase.
The government retained two other limits. Registered charities with income over £10,000 must still complete an annual return. The threshold for sending a charity's annual report and accounts to the Commission remains £25,000. This means a charity between £25,000 and £40,000 income may still need to file its report and accounts even when an independent examination is no longer required. The government's consultation response explains those decisions.
Confirm your legal structure
Structure affects the accounting route available to you. The higher receipts-and-payments limit applies to non-company charities. Charitable companies and charitable incorporated organisations have their own accounting and filing requirements, so confirm your structure before changing the format of your accounts.
The new limits apply in England and Wales. Charities registered in Scotland or Northern Ireland should use the guidance from their own regulator.
The new Order has been made, and Parliament records 30 September 2026 as its coming-into-force date. Charity Commission guidance is due to be updated before then. Keep an eye on that guidance if your income is close to a threshold or your structure is unusual.
Keep your donation records ready
Threshold changes do not reduce trustees' responsibility for accurate records. Reconcile donations against your bank records and accounting system, and keep a clear audit trail for any restricted funds.
Charities already using Wonderful.org can download donation and Gift Aid data for a chosen date range. Treat that export as one source record within your wider accounts. Gift Aid still depends on a valid donor declaration, and the charity claims it from HMRC.
Take four checks to your next trustee meeting
- Write down your accounting year end and whether it falls before or after 30 September 2026.
- Confirm your charity's legal structure.
- Compare expected annual income and assets with every relevant threshold.
- Ask your examiner, accountant or adviser what changes for the next accounts, then record the agreed approach in the minutes.
Immediate action: put your year end, structure and expected income beside the new thresholds before your next trustee meeting.
This article provides general information for charities in England and Wales. It is not legal or accounting advice. Trustees remain responsible for meeting the requirements that apply to their charity.