The Charity Commission has updated its guidance on reporting and accounting to reflect the introduction of the Charities Statement of Recommended Practice (SORP) 2026.
Published today, the guidance includes one guide for each of the three main structure types (a trust or an unincorporated association, a charitable company, and a charitable incorporated organisation) to better reflect that charities have different accounting requirements based on their legal structure.
The guidance – first published in 2016 and last updated in December 2025 – reflects the new income thresholds in charity law at which charities must follow the SORP and have their accounts examined or audited.
It comes eight months after the SORP 2026, which applies to accounting years starting on or after 1 January 2026, came into effect. One of the key changes is the introduction of a tiered reporting structure based on income.
Following a consultation, in October 2025 the government also announced changes to charity accounting thresholds, which will be effective from 30 September 2026.
The regulator said it would also update its smart answer tool, which helps charities prepare annual accounts.
Overall, all three guides say charities must prepare accounts and a trustees’ annual report and make these available to the public on request.
All charities must keep financial records including cash books, invoices, receipts and gift aid records for at least six years.
They must comply with anything their governing document says about financial management, while registered charities must submit information yearly to the commission.
The incoming threshold changes include a 50% rise in the audit threshold to £1.5m and an increase in the independent examination threshold from £25,000 to £40,000.
Regulator looking to simplify ‘complex’ rules
Amie Woods, assistant director of accountancy at the commission, said: “Charity trustees have stewardship of around £100bn of charitable money and people want to see how those funds are being spent to do good.
“Accounts and annual returns provide that essential information and by far the majority of charities submit these to the commission on time.
“This builds public trust and confidence in charity.
“Our guidance should help charities continue to get it right under the current system.”
She said that as the rules for compiling accounts are “complex”, the commission wants to explore “if there are other ways to make it more straightforward for charities” in the longer-term.
“It’s not just about cutting red tape, it’s about getting the right balance between reducing the burden on charities whilst maintaining accountability and protecting public trust,” she added.
Sue Smith, senior trustee guidance manager at the commission, said: “You may need to prepare your accounts differently this year as there are some changes to the accounting requirements for charities in England and Wales.
“Our refreshed guidance sets out clearly what to do, step by step.
“We’ve also listened to feedback and made our guidance easier for trustees – and their professional advisers – to use and find the relevant information for their charity.”
