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Frequently asked questions
What specific services do accountants for charities provide?
Accountants for charities provide a range of services including preparation of annual accounts, gift aid claims, VAT returns, Corporation Tax filings, and compliance with Charity Commission reporting. They also offer strategic advice on restricted funds, internal controls, and tax-efficient structures, ensuring your charity meets all statutory obligations while maximising financial efficiency.
How do I know if my charity needs a specialist accountant?
If your charity has an income above £25,000, you are legally required to have your accounts audited or independently examined. Even smaller charities can benefit from specialist advice on gift aid, payroll, and VAT. A qualified accountant with charity expertise will ensure you remain compliant and help you avoid common pitfalls, giving you confidence in your financial management.
What qualifications should I look for in a charity accountant?
Look for accountants who are members of recognised professional bodies such as ACCA, ICAEW, or AAT. These qualifications ensure the accountant has undergone rigorous training and adheres to ethical standards. Additionally, check that they have specific experience with charity accounting, as this requires knowledge of the Charities SORP and other sector-specific regulations.
How can an accountant help with HMRC compliance for my charity?
An accountant can assist with HMRC compliance by ensuring your charity registers for relevant taxes, such as VAT if your turnover exceeds the threshold, and by preparing accurate Corporation Tax returns. They can also help with PAYE for staff, gift aid claims, and tax reliefs, reducing the risk of penalties and ensuring you take advantage of all available exemptions.
What is the difference between an audit and an independent examination?
An audit is a more detailed review of your charity's financial statements, required for larger charities, and must be carried out by a registered auditor. An independent examination is a lighter-touch review suitable for smaller charities, where an independent person checks the accounts for errors and compliance. Your accountant can advise which applies to your charity based on its income and constitution.
How often should my charity review its accounting arrangements?
It is advisable to review your accounting arrangements annually, especially if your charity's income or activities change. Regular reviews ensure that your accountant remains suitable for your needs and that you are receiving value for money. Additionally, changes in legislation may affect your reporting requirements, so staying up to date with professional advice is essential for ongoing compliance.
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