The Fundraising Regulator, the body that oversees fundraising practice in England, Wales and Northern Ireland has today announced changes to the way it will collect its annual levy.
The changes will apply to levy years 4 and 5, running from September 2019 to August 2021. The changes include introducing two extra bandings at the lower end of the levy payment scale, meaning that smaller charities will move up the scale more gradually as their fundraising expenditure increases.
"By introducing the two extra bands it should smooth out the gradation," Fundraising Regulator chair Lord Toby Harris said in an interview published in this month's issue of Fundraising Magazine. "These will be put in place for charities that spend below £1m on fundraising."
As a result, some charities will be paying a smaller amount in levy payments than in previous years although others will pay more.
Base data rate to be updated
The Regulator also announced today that payments are to be based on the information that charities provided in their most recent audited accounts and annual return to the Charity Commission, usually the 2016/17 or 2017/18 financial year.
The levy is currently based on annual returns made to the Charity Commission in 2014, the latest information available when the levy was launched in 2016. The levy will continue to be based on total fundraising expenditure of the charities eligible to pay it.
The Fundraising Regulator currently asks that registered charities in England, Wales and Northern Ireland with fundraising costs of £100,000 or more pay the regulator’s annual levy. As of this year, around 95 per cent of charities eligible to pay the levy are doing so.
These changes announced today will come into effect on 1 September 2019 with invoices issued in August.
Charities which may be affected by the changes to levy bands will be informed in writing before the invoices are issued, the Regulator says.
According to Lord Harris, the Regulator will conduct a wider review of the levy "in line with the second strategic plan for the sixth year of the regulator in 2021".
The new bandings are shown below:
Old bandings
Fundraising expenditure between: £100,000 and £149,999 - £150 levy
£150,000 and £199,999- £300 levy
£200,000 and £499,999- £800 levy
£500,000 and £999,999- £1,500 levy
£1m and £1,999,999- £2,500 levy
£2m and £4,999,999- £4,000 levy
£5m and £9,999,999- £6,000 levy
£10m and £19,999,999- £8,000 levy
£20m and £49,999,999- £12,000 levy
Over £50m- £15,000 levy
New Bandings
Fundraising expenditure between: £100,000 and £149,999- £150 levy
£150,000 and £199,999- £300 levy
£200,000 and £349,999- £500 levy
£350,000 and £499,999- £800 levy
£500,000 and £749,000- £1,000 levy
£750,000 and £999,999- £1,500 levy
£1m and £1,999,999- £2,500 levy
£2m and £4,999,999- £4,000 levy
£5m and £9,999,999- £6,000 levy
£10m and £19,999,999- £8,000 levy
£20m and £49,999,999- £12,000 levy
Over £50m- £15,000 levy
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