Charity Compliance Update – January 2018

This month’s update is all about the changes to the Annual Return 2018 for charities registered with the Charity Commission for England and Wales. Hot off the press, read on for changes to reporting requirements.

In our consultations round-up this month we see two new key consultations around property matters.

Annual return 2018 – consultation update

The Charity Commission for England and Wales published the outcome of (and their responses to) their recent Annual return 2018 consultation on 2 January 2018. Changes apply to charities’ financial years starting on or after 1 January 2018 and are predominantly around how information is to be gathered from charities.

In an attempt to keep your main compliance update succinct, the consultation outcome is explored in detail here.

OSCR blog watch – GDPR

OSCR is running a series of six blogs around GDPR compliance. In the second in the series, Alison Johnston from the Information Commissioner’s Office talks about a charity’s purpose for processing personal data.

You can read this instalment here.

Independent Examination template update

The Charity Commission for England and Wales have updated their Independent Examination template for Receipts and Payments reporting. Ensure you are using the latest version by reviewing the updated documents here.

Consultations round-up

Here’s our monthly round-up of (and links to) key consultation opportunities and those closed, pending feedback.

The following consultations are currently open and inviting a response:

  • DCLG and DWP – Funding for supported housing – two consultations were launched on 31 October 2017 – one on housing costs for sheltered and extra care accommodation, and one on housing costs for short-term supported accommodation. For policy statement, consultation documents and how to respond click here. Closes 23 January 2018. Both consultations seek the views on the design of the government’s new supported housing funding models which relate to England only.
  • Charity Tax Group (CTG) – Business rates in multi-occupied properties

The CTG reports that following an announcement in the 2017 Autumn Budget that the Government would legislate to reinstate the relevant elements of the Valuation Office Agency’s (VOA’s) practice prior to the decision of the Supreme Court in Woolway, DCLG has launched a consultation on business rates in multi-occupied properties.

The ruling in the above case meant that two contiguous properties in the same occupation are only assessed as one if they can be considered as a self-contained piece of property. This applies if both parts are physically accessible without having to go onto other property or through commons parts (for example, a common corridor or stairwell). There has been an adverse effect on some ratepayers, including:

  • increases to the overall rateable value due to the loss of “quantum discount”
  • loss of Small Business Rate Relief for ratepayers who have seen their property split into parts
  • changes to rateable value due to rounding

The ruling was potentially important for small charities and charitable companies because many of them occupy two or three rooms or floors in multi-occupied buildings and not all of them receive 100 per cent business rate relief.

The consultation was launched (on 2 January 2018) with the following scope:

  • how the Government should capture their policy revision intention in legislation, and
  • how this policy intention should then be implemented

Responses should be sent in via e-mail by 23 February 2018.

The following consultations are closed with feedback analysis pending – watch this space for an update in future briefings:

  • Charity Commission for England and Wales:

The use and promotion of complementary and alternative medicine (CAM): making decisions about charitable status – closed on 19 May 2017. This consultation is about the Commission’s approach to deciding whether an organisation which uses or promotes CAM therapies is a charity. The Commission have released a statement, following receipt of over 600 responses:

“The Commission had planned to publish an analysis of the consultation in early August. However, the high volume of submissions means it has not been possible to prepare the analysis in that timeframe. We will continue our work on the review and plan to publish our analysis later in 2017.”

  • Charity Tax Group (CTG):
    • Taxation of employee expenses – closed 10 July 2017 – you can review the key consultation objectives and questions here.
    • Review of HMRC’s Guidance on Gift Aid Donor Benefits – closed 5 January 2018. To read more around the working group terms of reference and objectives click here.
  • HMRC – withdrawal of statutory concessions – closed on 7 March 2017
  • HMRC – Draft legislation: the Value Added Tax (Refund of Tax to Museums and Galleries) (Amendment) Order 2017 – published 27 March 2017, closed on 21 April 2017
  • HM Treasury (HMT) – legislation to support cheque imaging. HMT consulted on two measures to support the introduction of the Image Clearing System (ICS) for cheques:
    • Use of cheques as evidence of payment
    • Compensation in the event of an ICS loss

Closed 1 December 2017. Draft legislation and supporting consultation documents can be viewed here.

  • Charity Commission for Northern IrelandAnnual monitoring return 2018 – closed on 21 November 2017. Changes to apply to charities’ financial years starting on or after 1 January 2018. A full consultation report, providing an overview of the public consultation process and outlining how the Commission considered the responses they received will be available in Spring 2018.
  • Office of Tax Simplification (OTS) – review of depreciation and capital allowances and whether the use of accounts depreciation to provide relief for capital expenditure instead of capital allowances would simplify the preparation of tax returns for incorporated and unincorporated business. Deadline for responses was 30 November 2017. For more information about the OTS’s call for evidence see here.
  • OSCR – Fundraising draft guidance consultation – was extended to, and closed on, 8 December 2017. The response was split into parts:
  • Online usability questionnaire
  • Content questions and response form (scroll down to access)

OSCR will publish the final version of the guidance and an evaluation report of the consultation in early 2018.

As previously published by Accounting Web January 2018