Tag: Gov.uk

Charity Purposes and Rules

As a trustee, you must run your charity in a way that complies with your charity’s governing document and the law.

This includes making sure your charity achieves its purposes.

Every trustee is responsible for this. Even if certain tasks are done by individual trustees, employees or volunteers, all trustees are responsible.

Every charity has a governing document. It contains:

your charity’s aims or purposes (often referred to as its ‘objects’)
rules for how it must operate

Focus on your charity’s purposes

You must deliver only your charity’s purposes. Your charity’s funds can only be spent on supporting the delivery of these purposes.

Read the governing document. Make sure you understand:

what your charity is set up to achieve (its purposes)
who your charity is there to benefit (its beneficiaries)
what your charity can or cannot do to carry out its purposes (its powers)

Checking that your charity is furthering its purposes is something you will do all the time as a trustee.

Drifting into activities that your charity is not set up to do

This can happen if you do not focus on your charity’s purposes. For example, where the charity:

wants to deliver a new service, but trustees have not checked that this new work fits the charity’s purposes
has applied for a grant, which must be spent on activities that do not match the charity’s purposes

Using charity funds or resources on other purposes is very serious. Trustees may have to repay the charity from their own money.

Keep your charity’s purposes under review to ensure that they properly reflect what the charity does.

Autumn Budget and National Insurance Changes

Employer National Insurance changes from April 2025

The Autumn Budget announced there is to be an increase in the rate of National Insurance Contributions (NIC) paid by employers in respect of the wages they pay to their employees.

Currently, employers pay employer NIC at the rate of 13.8% on wages over £9,100. From April 2025, the rate employers must pay NIC would increase by 1.2% from 13.8% to 15%.

In addition, the threshold where employer contributions become payable will6 fall from £9,100 to £5,000. The threshold will then remain at £5,000 until 5th April 2028. The plan is to increase the threshold annually for inflation.

To support businesses, the Government intends to make changes to the Employment Allowance. The Employment Allowance is available to eligible businesses to reduce their employer NIC each tax year. The allowance currently allows eligible businesses with employer NIC bills of £100,000 or less in the previous tax year to deduct £5,000 from their employer NIC bill.

The Chancellor announced an increase in the Employment Allowance from £5,000 to £10,500, and plans to remove the £100,000 eligibility threshold, expanding this to all eligible employers with employer NICs bills from 6th April 2025.

National Minimum Wage and National Living Wage rates

The government reviews minimum wage rates every year and they’re usually updated in April. Check when rate increases must be paid.

From 1 April 2024, workers aged 21 and over will be entitled to the National Living Wage.

	21 and over	18 to 20	Under 18	Apprentice
April 2024	£11.44	£8.60	£6.40	£6.40

It’s against the law for an employer to pay less than the National Minimum Wage or National Living Wage.
They also must keep accurate pay records and make them available when requested.
If an employer has not been paying the correct minimum wage, they should resolve the problem as soon as possible.
The employer must also resolve any backdated non-payment of minimum wage. This is even if the employee or worker no longer works for them.

It’s against the law for an employer to pay less than the National Minimum Wage or National Living Wage.
They also must keep accurate pay records and make them available when requested.
If an employer has not been paying the correct minimum wage, they should resolve the problem as soon as possible. The employer must also resolve any backdated non-payment of minimum wage. This is even if the employee or worker no longer works for them.

It’s against the law for an employer to pay less than the National Minimum Wage or National Living Wage.
They also must keep accurate pay records and make them available when requested.
If an employer has not been paying the correct minimum wage, they should resolve the problem as soon as possible.
The employer must also resolve any backdated non-payment of minimum wage. This is even if the employee or worker no longer works for them.

ACAS has more information here

Payroll: annual reporting and tasks

Send your final payroll report

Send your final Full Payment Submission (FPS) on or before your employees’ last payday of the tax year (which ends on 5 April).

Put ‘Yes’ in the ‘Final submission for year’ field (if available) in your payroll software.

If you run more than one payroll under the same PAYE scheme reference (for example for employees you pay weekly and monthly), include the end-of-year information in your last report.

You need to send extra forms if you claimed a National Insurance holiday for new employers.

When to send an Employer Payment Summary (EPS)

You should send your final report in an EPS instead of an FPS if any of the following apply:

you forgot to put ‘Yes’ in the ‘Final submission for year’ field in your last FPS
your software does not have a ‘Final Submission for year’ field on the FPS
you did not pay anyone in the final pay period of the tax year
you sent your final FPS early and you did not pay anyone for one or more full tax months in the last tax year

If you’re late sending your final report

From 20 April you can send an FPS to correct your 2021 to 2022 tax year payroll data by giving the year-to-date figures.

‘Week 53’ payments

If you pay your employees weekly, fortnightly or every 4 weeks, you might need to make a ‘week 53’ payment in your final FPS of the year.

Your payroll software will work out ‘week 53’ payments for you.

In the ‘Tax week number’ field of your FPS, put:

‘53’ if you pay your employees weekly
‘54’ if you pay them fortnightly
‘56’ if you pay them every 4 weeks

HMRC will send a P800 form to any employees who owe tax following a ‘week 53’ payment.

More information can be found here

National Minimum Wage and National Living Wage rates

Current rates

These rates are for the National Living Wage (for those aged 23 and over) and the National Minimum Wage (for those of at least school leaving age). The rates change on 1 April every year.

	23 and over	21 to 22	18 to 20	Under 18	Apprentice
April 2022 (current rate)	£9.50	£9.18	£6.83	£4.81	£4.81
April 2023	£10.42	£10.18	£7.49	£5.28	£5.28

Apprentices

Apprentices are entitled to the apprentice rate if they’re either:

aged under 19
aged 19 or over and in the first year of their apprenticeship

More information and examples can be found here

Charity fundraising appeals: using donations when you’ve raised more than you need

If your charity makes an appeal for a specific purpose or purposes, you must use the donations only for that purpose or purposes.

However, you may receive more donations than you need. For example:

an appeal to refurbish a community café might raise more than needed for the refurbishment; that is, the café is refurbished and there is money left over

an appeal to buy equipment for a playground might raise more than needed – all the equipment has been bought and there is money left over

If this happens, you have donations given for a particular purpose, but you cannot use them for this.

Look at your appeal wording. It may allow you to spend the donations on your charity’s other projects.

If not, you will need to follow the required process set out below to decide a new purpose for the donations, so that you can use them.

Donations to an appeal are usually money, but can be property of any kind. For example, goods.

More detailed information and guidance can be found here

The 6 Main Duties of Trustees

Trustees have overall control of a charity and are responsible for making sure it’s doing what it was set up to do. Their main duties are:

1. Ensure your charity is carrying out its purposes for the public benefit

You and your co-trustees must make sure that the charity is carrying out the purposes for which it is set up, and no other purpose.

2. Comply with your charity’s governing document and the law

You and your co-trustees must:

make sure that the charity complies with its governing document
comply with charity law requirements and other laws that apply to your charity

3. Act in your charity’s best interests

You must:

do what you and your co-trustees (and no one else) decide will best enable the charity to carry out its purposes
with your co-trustees, make balanced and adequately informed decisions, thinking about the long term as well as the short term
avoid putting yourself in a position where your duty to your charity conflicts with your personal interests or loyalty to any other person or body
not receive any benefit from the charity unless it’s properly authorised and is clearly in the charity’s interests; this also includes anyone who is financially connected to you, such as a partner, dependent child or business partner

4. Manage your charity’s resources responsibly

You must act responsibly, reasonably and honestly. This is sometimes called the duty of prudence. Prudence is about exercising sound judgement.

5. Act with reasonable care and skill

As someone responsible for governing a charity, you:

must use reasonable care and skill, making use of your skills and experience and taking appropriate advice when necessary
should give enough time, thought and energy to your role, for example by preparing for, attending and actively participating in all trustees’ meetings

6. Ensure your charity is accountable

You and your co-trustees must comply with statutory accounting and reporting requirements.

Find out more here

Insolvency and Redundancy Payments

Previously, if your employer became insolvent, and you were therefore made redundant, you used to have to go to an employment tribunal to claim all redundancy payments, but now you can apply direct to the government’s Insolvency Service for the money that you are owed.

How to claim for redundancy and other money you’re owed by an employer

To apply, you must complete the online application. The Insolvency Service will then assess your claim and pay you the money you’re entitled to.

Separate payments are made for different parts of your claim, such as redundancy pay, holiday pay and arrears of pay. You will then be sent a letter each time that the Insolvency Service makes a payment. This means that you may get several different letters from the Insolvency Service.

Further Government Guidance

If you were made redundant on or after 6 April 2021, your weekly pay is capped at £544. If you were made redundant before 6 April 2021, these amounts will be lower. This means if your gross weekly pay was more than this, we have capped each one of your payments.

If you are owed more than the maximum we can pay, you can register as a creditor in the insolvency for any outstanding money you’re owed.

Further details can be found here

Introduction to PAYE

As an employer, you normally have to operate PAYE as part of your payroll. PAYE is HM Revenue and Customs’ (HMRC) system to collect Income Tax and National Insurance from employment.

You do not need to register for PAYE if none of your employees are paid £120 or more a week, get expenses and benefits, have another job or get a pension. However, you must keep payroll records.

Payments and deductions

When paying your employees through payroll you also need to make deductions for PAYE.

Payments to your employees

Payments to your employees include their salary or wages, as well as things like any tips or bonuses, or statutory sick or maternity pay.

Deductions from their pay

From these payments, you’ll need to deduct tax and National Insurance for most employees. Other deductions you may need to make include student loan repayments or pension contributions.

Reporting pay and deductions

If you run payroll yourself, you’ll need to report your employees’ payments and deductions to HMRC on or before each payday.

Your payroll software will work out how much tax and National Insurance you owe, including an employer’s National Insurance contribution on each employee’s earnings above £170 a week.

You’ll need to send another report to claim any reduction on what you owe HMRC, for example for statutory pay.

Paying HMRC

You’ll be able to view what you owe HMRC, based on your reports. You then have to pay HMRC, usually every month.

If you’re a small employer that expects to pay less than £1,500 a month, you can arrange to pay quarterly – contact HMRC’s payment enquiry helpline.

Other things to report

As part of your regular reports, you should tell HMRC when a new employee joins and if an employee’s circumstances change, for example they reach State Pension age or become a director.

You have to run annual reports at the end of the tax year – including telling HMRC about any expenses or benefits.

More details can be found here

State Pension Update

In November 2018, State Pension age was 65 for men and women. The State Pension age is regularly reviewed to make sure that the State Pension is affordable and fair. People are living longer, and spending a larger proportion of their adult life in retirement than in the past. State Pension age is gradually increasing for men and women, and will reach 67 by 2028.

Proposed new timetable for State Pension age increases

The government has announced plans to bring this timetable forward. The State Pension age would therefore increase to 68 between 2037 and 2039.

Your date of birth	How the proposals affect you
On or before 5 April 1970	No change
Between 6 April 1970 and 5 April 1978	Your State Pension age is currently 67. It would increase to between 67 years and 1 month, and 68 years, depending on your date of birth
After 6 April 1978	No change. Your State Pension age remains 68

These proposed changes would have to be approved by Parliament before they are agreed.

When can I retire?

Your State Pension age is the earliest age you can start receiving your State Pension. Use the link below to check:

when you’ll reach State Pension age
your Pension Credit qualifying age
when you’ll be eligible for free bus travel

Click here to start

Check your State Pension forecast to find out how much money you’ll get

Working after State Pension age

You can keep working past your State Pension age.
You can usually work for as long as you want to. ‘Default retirement age’ (a forced retirement age of 65) no longer exists.
You don’t pay National Insurance if you work past State Pension age.
You could pay tax – it depends on the size of your total income.

You can find more information here