Working towards a cause through a non-profit or charitable organisation is incredibly gratifying and enriching. But it’s more than just doing the good work; it’s also about doing it responsibly. Like any other organisation, your non-profit also needs to follow specific regulations and legal requirements.
However, charity rules and regulations can be complex and broad in scope, and often cover a wide range of issues, ranging from transparency in governance to meeting financial standards. This complex regulatory framework is created to make sure UK charities remain transparent, accountable, and dedicated to their collective mission.
To help you understand and navigate charity law in the UK and make things a little less complicated, this blog highlights the 6 core compliance areas that every charity needs to prioritise.
1. Charity Commission Reporting and Annual Returns
First and foremost, every charity in England and Wales needs to be registered with the Charity Commission and meet its requirements of having an exclusive charitable purpose and demonstrating public benefit. Furthermore, you need to submit an Annual Return and financial statements to the Charity Commission.
Further requirements depend on your charity’s income:
If your nonprofit has an annual income greater than £25,000, you need to submit an annual report, accounts, and an independent examiner’s or auditor’s report.
On the other hand, if your nonprofit’s income is below £25,000, you still need to submit the Annual Return, but may have simpler reporting requirements.
It’s easier to meet non-profit regulatory compliance needs with KindLink’s online CRM as it helps you track donations, generate reports, and maintain records in a user-friendly interface.
2. Fundraising Regulations and Transparency
If your charitable trust is involved in raising money through fundraising activities, it must follow the Code of Fundraising Practice, regulated by the Fundraising Regulator, a body overseeing charitable fundraising in the UK. Following this code of practice assures donors, supporters, and regulators that your fundraising activities are ethical, transparent, and respectful of donors’ rights.
Make sure you register your charity with the Fundraising Regulator and purposefully display the Fundraising Badge on all your promotional materials.
3. GDPR and Data Protection Compliance
Since the implementation of the General Data Protection Regulation (GDPR) and the Data Protection Act 2018, all charitable organisations need to fulfil the stringent requirements around collecting, storing, and processing personal data. This applies to donor details, volunteer records, or any other identifiable information. According to this charity regulation in the UK and the EU, you need to get consent explicitly, offer the right to access and delete data, and secure data through encryption and access controls.
Not meeting this non-profit regulatory compliance need may result in heavy fines and loss of public confidence and trust. However, you can avoid this by signing up and using a GDPR-compliant platform like KindLink, with features that allow secure data storage, user access controls, and audit trails.
4. Gift Aid and HMRC Tax Compliance
Gift Aid is a tax incentive and a significant source of funding for charities and other foundations in the UK. Gift Aid regulations allow your charity to reclaim an extra 25p for every £1 donated by taxpayers in the UK, only if you strictly adhere to the HMRC regulations.
The guidelines state that:
- Submitting accurate Gift Aid claims
- Maintaining signed declarations by donors
- Keeping donor records for at least 6 years
When you sign up your charity with KindLink, your Gift Aid collection and reporting tasks are automated, which reduces manual effort while ensuring non-profit regulatory compliance with the HMRC.
5. Employment and Volunteer Management
Charities in the UK are subject to the same employment rules as any other UK business. This means you need to follow the guidelines in the National Minimum Wage Act, create employment contracts, and make sure your employees and volunteers are working in a safe environment. You also need to make right-to-work checks and DBS checks where appropriate, and create volunteer agreements.
These charity regulations state that volunteers’ rights must be protected, and they must not be treated as employees. You can do this by providing clearly defined roles and responsibilities for both volunteers and employees, and supervising them to ensure they follow safeguarding procedures, especially when working with vulnerable groups.
6. Safeguarding the Responsibility of Trustees
Good governance is the foundation of running a successful and purposeful charity. It’s the legal duty of the trustees of UK charitable organisations to ensure their charity is working under the Charity Commission’s guidance.
According to the guidelines, your trustees need to follow your charity’s governing document, manage risks, avoid conflicts of interest, maintain financial oversight, and ensure resources are being used effectively.
KindLink’s free and easy-to-use online platform has features such as activity logs, financial tracking, and document management that give your trustees access to everything they need to make informed decisions and demonstrate good governance.
Use KindLink Non-Profit CRM to Stay Compliant with Reporting
Meeting non-profit regulatory compliance requirements doesn’t have to be complicated or confusing. Fulfilling these charity rules and regulations allows you to showcase that your charitable organisation is transparent, accountable, and trustworthy.
KindLink’s no-cost, online platform takes the guesswork and complication out of the various regulatory and legal requirements for charities.
By partnering with us, you make the most of:
- GDPR-compliant data storage
- Gift Aid automation
- Real-time financial dashboards
- Donor management and volunteer CRM
- Trustee-level reporting tools
Let us simplify your non-profit regulatory compliance efforts. Sign up today and get started for free.