New annual return questions for charities

The Annual Return is the online form that all charities (and charitable incorporated organisations (CIOs)) with yearly incomes of £10,000 or more complete within 10 months of the end of their financial reporting period.

On 21^st December, the Charity Commission published the long-awaited new set of questions that charities will have to complete as part of their 2023 Annual Return (for periods beginning on or after 1 January 2023).

Several changes, and indeed improvements, have been made following feedback from charities about the previous structure, following on from the consultation process the regulator ran between 9^th June 2022 and 1^st September 2022.  Following the consultation, changes introduced by the Commission include:

• A reduction in the maximum number of questions that can be asked of charities to forty-nine, which is 3 less than was proposed in the consultation.
• The introduction of income thresholds for 5 of the new questions, to further reduce the burden for smaller charities.
• The rewording of 19 of the questions, to improve clarity and/or reduce resource and time required of charities where possible.
• Substantial improvements to the glossary and guidance pages, which should let charities answer questions quickly and accurately.

A new guide is set for release this month (January 2023), to give charities some extra assistance, as they set about compiling the new information required.  The minimum number of questions asked of all charities in the 2023 Annual Return will increase slightly, to 26 – however this is 4 less than proposed in the consultation.  A further 6 questions are intended to be removed from the Annual Return from 2024 onwards once relevant data has been captured in 2023.

The full set of questions that make up the Annual Return for 2023 can be found using this link, with there also being a new guide published to help you understand the questions, which can be found here.

The Commission consider the Annual Return improvements to be a key step to improve the data being reported by charities, enabling the Commission to better identify and record risks and problems in the sector.  This in turn enables the public to make better informed and confident choices about charities and should grant everyone a clearer understanding of the sector.

So, what’s next?

• Sometime in Spring 2023, the Commission will be expanding enrolment onto the My Charity Commission Account. Trustees and those currently noted as the relevant contacts on the Commissions website, will, if they haven’t been already, be invited to create an account on this platform.
• Following this, in early Summer 2023, this new system becomes live, with Trustees then expected to submit their Annual Return for 2023 (and beyond) via this new digital platform.

If you have any queries concerning the new annual return questions for charities, please contact Daniel Lennox, Susan Robinson or Lucy Hammond for more information.