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Legal obligations of charities

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The legal obligations of charities under the Charities Acts, Trustee Acts, and the Companies Acts.

All charities must comply with:

  • the Charities Act 2011 replaced most of the Charities Act 2006 and Charities Act 1992. It was then amended by the Charities (Protection and Social Investment) Act 2016 and again recently by the Charities Act 2022.
  • the Charities (Protection and Social Investment) Act 2016 made four key changes in law:
    • it gave new regulatory powers to the Charity Commission
    • it created circumstances in which people can be automatically disqualified from acting as a trustee
    • it gave more controls over the process of charitable fundraising
    • it confirmed the power of charities to make social investments
  • The Charities Act 2022 has received Royal Asset and changes will begin being implemented from autumn 2022.
  • the Trustee Acts 1925, 2000 (which apply primarily to charitable trusts (see below) and charitable companies and CIOs in certain circumstances)the most recent Act concerns the powers of trustees regarding investments and delegation.
  • Charity Commission regulation. The Commission has a full list of guidance that explains what charities ‘must’ and ‘should’ do.
    • 'Must' means it is a legal or regulatory requirement or duty that trustees must comply with.
    • 'Should’ means it is good practice that the Charity Commission expects trustees to follow and apply to their charity or be able to explain why not.
  • the Statement of Recommended Practice (SORP) for charity accounting: published by the Charity Commission, requires compliance (depending on annual income) on the submission of annual returns, reports and accounts.
  • the Fundraising Regulator: the independent regulator of charitable fundraising in England, Wales and Northern Ireland advocates best practice in fundraising (using the Code of Fundraising Practice) to protect donors and support the work of fundraisers.
  • laws on trading, political activity, and fundraising. These are set out in
  • your governing document, constitution or Memorandum and Articles of Association depending on your legal structure.

Charitable companies

In addition to the above, charitable companies (those incorporated as a company limited by guarantee) must comply with provisions in the Companies Act 2006. Additional requirements include filing details of trustees as directors at Companies House.

Charitable Incorporated Organisations

It is also possible to set up a charity which is a corporate body in the form of a Charitable Incorporated Organisation, or 'CIO'.

CIOs were established as a new type of legal structure in Part 11 (section 204 to 250) of the Charities Act 2011, and the detail for how CIOs operate are set out in secondary legislation such as the Charitable Incorporated Organisations (General) Regulations 2012.

Charitable trusts

Charities can also be established as in the form of trusts, where the trustees can only use the trust funds to benefit charities or charitable purposes. Trustees of these structures will primarily need to comply with the Trustee Acts 1925 and 2000.

Last reviewed: 27 July 2022

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This page was last reviewed for accuracy on 27 July 2022

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