HMRC will no longer require large charities to comply with its onerous senior accounting officer (SAO) rules, after discussions with accounting firm BDO and charities Barnardo’s and Cancer Research UK.

Introduced in 2009, the SAO rules cost large charities management time and often consultancy costs by requiring those in charge of finance to certify that they had ensured their accounting systems were adequate for tax reporting.

The rules applied to all companies limited by guarantee, including charities with this status, which have a turnover of more than £200m or a balance sheet total more than £2bn.

Now however, HMRC has agreed to change its definition of turnover for these purposes in order that almost all charities will no longer be covered by the rules.

Representatives at the discussions were Jo Gilbey and Paul Knight, tax partner and tax director at BDO, Kevin Barnes, director of finance at Barnardo’s and Richard Bray, technical director at Cancer Research UK.

For more details, read Paul Knight’s technical briefing on the subject.