The introduction of compulsory registration of all churches regardless of the excepted status has been delayed once again.

Compulsory Registration

The Charities Act 2006 (and now s.30 of the 2011 Act) stated that Churches would no longer be able to avoid registering with the Charities Commission and publishing their accounts in the public domain; but implementation of the new ruling seems to be a moveable feast.

The already extended deadline of 31st March 2014 is in the dim and distant past and a recent amendment to the Charities (Exception from Registration) Regulations 1996 suggests that the Commission will suggest giving further grace until at least 2021.

white churchWhat is an Excepted Church?

A charitable church is required to register with the Charity Commission unless it is exempt or excepted, with most being excepted.

This excepted status is achieved by proving that the charitable church is

  • used wholly or mainly for public religious worship,
  • has annual income of less than £100,000
  • already supervised by an oversight body (listed by the commission) that has clear guidance about the management and financial operations of the Church, and
  • not using the new CIO structure

Examples include most Baptist Churches, PCC (Parochial Church Council) and the FIEC (Fellowship of Independent Evangelical Churches) members.

The Commission has always had the power to demand that a church registers with them if they have reason to believe that further supervision is needed.

What will this change mean?

The short answer, additional compliance burden.

In a similar way to charitable companies being answerable to the demands of the Charities Commission/Charities Act and Companies House/Companies Act, previously excepted churches will have to report to their current oversight body and the Commission.

This will involve submitting accounts that consider the guidance of both their oversight body and the Charities SORP to both bodies.  They will also need to complete the Commission’s Annual Return.

In his 2012 review, Lord Hodgson recommended that the compulsory registration be phased over 3 years, by gradually reducing the £100,000 exception limit, but that suggestion has yet to be included in any Commission guidance.

Fortunately for me, the excepted Churches I act for are governed by the PCC whose accounting guidance closely reflects the SORP, so it should be a simple matter of filing the accounts and annual return with the commission.  Fingers crossed!

Further Guidance

If your charity or church needs guidance about it’s reporting responsibilities, please do not hesitate to give me a call on 01480 426500.

 

The information provided in this blog illustrates my opinions and experiences, it does not constitute advice and I do not accept responsibility for any actions taken or refrained from as a result of reading this post.

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