Accounting requirements for independent churches
These are the key terms and legal requirements relating to submitting your accounts to the Charity Commission.
The table below summarises the legal requirements that apply. Please note this only applies to churches that are not limited companies. If your church is a limited company, different requirements apply. Churches affiliated to FIEC are not required to send annual accounts to FIEC. To make sense of the table you need to know the following terms:
An Excepted Charity means a charity that is not required to register with the Charity Commission. Your church will be an excepted charity if…
1. it is affiliated to FIEC and its income is less than £100,000,
or
2. it is not affiliated to FIEC and its income is less than £5,000.
(These figures are likely to change in October 2012).
A Registered Charity means a charity that is registered with the Charity Commission. Your church needs to register with the Charity Commission if…
1. it is established for wholly charitable purposes
and
2. its income a) exceeds £100,000 (even if it is affiliated to FIEC) or b) exceeds £5,000 and is not affiliated to the FIEC or other relevant umbrella body.
| Excepted Charity | Yes | Income not exceeding £25k No external scrutiny needed unless required under the church’s constitution or rules. Income exceeding £25k but not exceeding £100k Independent examination required. A full audit is not required unless the church’s constitution or rules require it. See here for guidance on independent examinations. |
Not required | None unless specifically requested |
| Registered Charity | Yes | Income not exceeding £25k No external scrutiny needed unless required under the church’s constitution or rules. Income exceeding £25k but not exceeding £250k Independent examination required. A full audit is not required unless the church’s constitution or rules require it. Income exceeding £250k but not exceeding £500k and total assets less than £3.26m As above and the independent examiner must be from a specified body. See here for further details. Income exceeding £500k or income exceeding £250k and assets greater than £3.26m Full statutory audit by a registered auditor required. |
Income not exceeding £25k Simplified annual report required. See here at section H for more details. Income exceeding £25k but not exceeding £250k As above Income exceeding £250k but not exceeding £500k and total assets less than £3.26m As above Income exceeding £500k or income exceeding £250k and assets greater than £3.26m A full Annual Report must be prepared. |
Income not exceeding £25k Do not send accounts or Annual Report. If income is £10k or less, complete Annual Update form. If income is greater than £10k complete online Annual Return. Income exceeding £25k but not exceeding £250k Complete Annual Return and also send Annual Report and Accounts. Income exceeding £250k but not exceeding £500k and total assets less than £3.26m As above Income exceeding £500k or income exceeding £250k and assets greater than £3.26m As above and if income exceeds £1m, a Summary Information Form must also be supplied. |
| Produce accounts in accordance with statutory requirements and make them available to the public on request* | External scrutiny of accounts | Annual Report | Documents to send to Charity Commission |
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- *See here to download a template for preparing accounts based on payments and receipts method.
- *See here for a template based on accruals method. This also links to a template report for an independent examination.
Footnotes
Last updated on 13/03/12
This article reflects FIEC Ltd’s understanding on the date above. It is designed for the purpose of knowledge sharing and does not constitute legal advice.
FIEC Practical Services is the trading name of The Fellowship of Independent Evangelical Churches Limited (FIEC Ltd.). FIEC Ltd. is a Registered Charity in England and Wales No. 251395, a Company incorporated in England No. 225717, and a Charity Registered in Scotland SC039913.