Department of Culture, Media, and Sport publish the outcome of public consultation on financial thresholds

Department of Culture, Media and Sport publish the outcome of public consultation on financial thresholds

The Department of Culture, Media, and Sport (DCMS) has published the results of its ten-week public consultation where it sought views on the financial thresholds in the Charities Act 2011 and whether inflationary increases to the thresholds are necessary.   We were pleased to participate in the consultation through the Charity Law Association, and broadly support the changes that are now proposed.

In their report, 'Law Commission: Technical Issues in Charity Law (Law Com No 375)', the Law Commission recommended that the government continuously review the financial thresholds contained in the Charities Act 2011 with the aim of ensuring they remain appropriate.

The consultation issued by the DCMS was based on the Law Commission's recommendations and covered the financial thresholds in the Charities Act 2011, including those related to charity registration, excepted charities, reporting and accounting.   It also covered the financial thresholds relating to professional fundraising as per the Charities Act 1992 and the amendments made by the Charities Act 2022.

Financial thresholds relating to Gift Aid (as contained in the Corporation Tax Act 2010 and Income Tax Act 2007) were not covered in the consultation.

The Outcome

On 31 October 2025, DCMS published the outcome of its consultation which concluded that the income thresholds will remain at the same level for:

• Preparing an annual return
• Filing accounts and an annual report
• Registration of charities
• Excepted charities
• Disclosure statements in official publications

The thresholds will also remain the same for the provisions introduced by the Charities Act 2022, namely, thresholds relating to small ex-gratia payments, application of property cy-près and permanent endowment.

The Government has, however, proposed the following increases of financial thresholds:

• The income requirement for a full audit is to increase from £1million to £1.5million.
• Where gross income is below the income threshold, the value of the assets which mean an audit is nevertheless required will rise from £3.26million to £5million.

The Government has also proposed increases in the thresholds relating to fundraising including the level of remuneration where an individual is considered a professional fundraiser and the remuneration levels under which fundraisers are excluded from particular solicitation requirements.

Implementation 

The Government intends for the new thresholds to come into force on 1 October 2026.  Charity Commission guidance will likely be published alongside the changes.