TRW & Co · Tax, Private Wealth & Family
Charity Solicitors in London
Charity solicitors in London advise founders, trustees and donors on setting up and running charities: choosing a structure, registering with the Charity Commission, meeting trustee duties, fundraising and trading lawfully, and handling regulatory issues. With new accounting thresholds for financial years ending from 30 September 2026, many charities need to review their reporting obligations now.
Key pointMost charity law problems start with process, not bad faith: an unauthorised trustee payment, a land sale without the statutory steps or a serious incident left unreported. Good minutes and clear authority protect trustees more than anything else.
At a glance
£5,000 registration threshold
Charities based in England or Wales must register with the Charity Commission if income is at least £5,000 a year, or if they are a CIO.
New audit threshold
For financial years ending on or after 30 September 2026, an audit is required where income exceeds £1.5 million, or income exceeds £500,000 and assets exceed £5 million.
Independent examination
Independent examination now applies where income exceeds £40,000, up from £25,000, for financial years ending on or after 30 September 2026.
Trustee benefit rules
Trustees generally cannot benefit from their charity unless authorised by the governing document, statute or the Charity Commission.
Separate UK regulators
The Charity Commission regulates England and Wales; OSCR regulates Scottish charities and the Charity Commission for Northern Ireland regulates charities there.
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What charity solicitors in London advise on
Charity solicitors in London advise charities, their trustees and the people who fund them on how to set up, govern, finance and protect organisations established for public benefit. The work covers choosing a legal structure, registration with the Charity Commission, trustee duties, fundraising and trading, property, mergers, regulatory investigations and international grant-making. It also covers the private client side: families and businesses creating foundations or leaving gifts to charity.
Charity law is a distinct body of law, not just company or trust law with a tax label. Charities have restricted purposes, trustees who generally cannot benefit, a regulator with real investigative powers and reporting duties that scale with size. A decision that would be routine for a company, such as paying a trustee, selling land or campaigning on a policy issue, may need specific authority or careful process in a charity.
TRW & Co advises founders, trustees, philanthropists, family offices and businesses establishing corporate foundations. Our charity work connects with our private client, trusts and tax practices.
Choosing a charity structure
To be a charity in England and Wales, an organisation must be established for purposes that are exclusively charitable and for the public benefit. Section 3 of the Charities Act 2011 lists the descriptions of charitable purposes, including the prevention or relief of poverty, the advancement of education, religion and health, and a residual category for other recognised purposes. The legal form is a separate choice, and it determines liability, contracting and administrative burden.
| Structure | Legal personality and liability | Registered with | Suits |
|---|---|---|---|
| Charitable trust | No separate legal personality; trustees contract personally and can face personal liability | Charity Commission (if over the registration threshold) | Grant-making foundations with an endowment and few employees or contracts |
| Unincorporated association | No separate legal personality; members and trustees exposed | Charity Commission (if over the registration threshold) | Small membership groups; increasingly replaced by CIOs |
| Charitable company limited by guarantee | Separate legal personality; members' liability limited | Companies House and the Charity Commission | Operational charities with staff, contracts and property |
| Charitable incorporated organisation (CIO) | Separate legal personality; members' liability limited or nil | Charity Commission only | Operational charities wanting incorporation without dual regulation |
| Charitable community benefit society | Separate legal personality; members' liability limited | FCA society register; HMRC for tax purposes | Community enterprises raising money through community shares |
For most new operational charities, the real choice is between a charitable company and a CIO. A CIO avoids filing with Companies House, but its constitution must follow the Commission's model framework, and some lenders are less familiar with it. A charitable company offers a well-understood structure for borrowing and a public register of charges. Our guide to charity structures compares the options in more detail.
The legal and regulatory framework
The Charities Act 2011 is the main statute for charities in England and Wales. It defines charitable purposes and the public benefit requirement, sets out registration and accounting duties, and gives the Charity Commission its powers. The Charities Act 2022 amended it to simplify many administrative processes, including changes to governing documents, land disposals, the use of permanent endowment and trustee payments for goods.
The Charity Commission registers and regulates charities in England and Wales. It can open statutory inquiries, require information, suspend or remove trustees, appoint interim managers and freeze bank accounts. Appeals against many of its decisions go to the First-tier Tribunal (Charity). Charity solicitors in London deal with the Commission on registration, consents, serious incident reports and, where things go wrong, investigations.
Other regulators matter too. HMRC decides whether a charity qualifies for tax reliefs and Gift Aid. The Fundraising Regulator sets the Code of Fundraising Practice. The ICO regulates use of donor and beneficiary data. Charities in Scotland are regulated by OSCR and in Northern Ireland by the Charity Commission for Northern Ireland, under different legislation. A charity based in England that operates in Scotland may need to register there as well.
Registration
A charity based in England or Wales must apply to register with the Charity Commission if its income is at least £5,000 a year, or if it is a CIO. Some charities are exempt or excepted, such as many universities and some religious charities, and are regulated in other ways. Registration requires the charity to show that its purposes are exclusively charitable and that it will operate for public benefit.
Accounts and reporting thresholds
Reporting duties depend on income and, for audit, on assets. The Commission has confirmed new accounting thresholds that apply to financial years ending on or after 30 September 2026, alongside the new Charities SORP for accounting periods starting on or after 1 January 2026.
| Requirement | Years ending before 30 September 2026 | Years ending on or after 30 September 2026 |
|---|---|---|
| Annual return to the Commission | Income over £10,000 | Income over £10,000 |
| Trustees' annual report and accounts sent to the Commission | Income over £25,000 | Income over £25,000 |
| Independent examination required | Income over £25,000 | Income over £40,000 |
| Receipts and payments accounts allowed (unincorporated charities and CIOs) | Income £250,000 or less | Income £500,000 or less |
| Examiner must be professionally qualified | Income over £250,000 | Income over £500,000 |
| Audit required | Income over £1,000,000, or income over £250,000 and assets over £3,260,000 | Income over £1,500,000, or income over £500,000 and assets over £5,000,000 |
A charity's governing document can impose stricter requirements, and charitable companies must also meet Companies Act obligations. The Commission's charity accounts guidance sets out the rules by structure.
Trustee duties and good governance
Trustees are collectively responsible for the charity. The Commission's guidance, The essential trustee (CC3), summarises their core duties: to act in the charity's best interests, to further its purposes for public benefit, to comply with the governing document and the law, to manage resources responsibly, to act with reasonable care and skill, and to be accountable.
Conflicts of interest and trustee benefits
Trustees generally cannot benefit from their charity unless the benefit is authorised by the governing document, by statute or by the Commission. The Charities Act 2011 allows payment to a trustee for services, and following the 2022 reforms for goods supplied with services, if strict conditions are met, including a written agreement and a minority of conflicted trustees on the board. Conflicts must be declared and managed, and conflicted trustees should not take part in the decision.
Decision-making and delegation
Boards can delegate to committees, executives and investment managers, but they retain responsibility and must supervise. Charity solicitors in London often see problems where decisions were taken by the chief executive or a founder without proper board authority. Clear schemes of delegation, minutes that record reasons, and regular review of the governing document help trustees show that decisions were properly made.
When the Charity Commission investigates
The Commission usually starts with a compliance case, asking trustees for information and explanations. If it has serious concerns, it can open a statutory inquiry, which is published, and use its protective powers to act for the charity's benefit. Trustees should respond accurately and on time, preserve documents, and consider whether an internal review or independent investigation would help. Charity solicitors in London can manage that correspondence, prepare trustees for interviews and help the board show the Commission that problems have been identified and fixed.
Mergers, incorporations and closure
Charities merge to share costs, combine expertise or rescue a struggling organisation. A merger usually involves transferring assets to an incorporated charity, dealing with employees under TUPE, and registering the merger with the Commission so that future legacies to the old charity are not lost. Charity solicitors in London also advise unincorporated charities converting to a CIO or company, and trustees closing a charity whose purposes have been fulfilled.
Charity law rarely punishes trustees for a decision that turned out badly. It looks at whether they asked the right questions, took advice where needed and recorded why they decided as they did.
Fundraising, trading and tax
Fundraising is regulated by law and by the Code of Fundraising Practice. The Charities (Protection and Social Investment) Act 2016 requires written agreements with professional fundraisers and commercial participators with specified content, and larger charities must report on their fundraising approach in their annual report. Data protection and electronic marketing rules govern how donors are contacted.
Charities can trade in pursuit of their purposes, known as primary purpose trading, without tax difficulties. Non-primary purpose trading above modest levels is usually carried out through a wholly owned trading subsidiary, which gift-aids its profits to the parent charity. Investment in the subsidiary, shared staff and premises, and loans from the charity all need to be on proper terms and in the charity's interests.
Charities benefit from exemptions on most income and gains applied for charitable purposes, business rates relief and Gift Aid on qualifying donations from UK taxpayers. To claim, a charity must be recognised by HMRC, and its managers must be fit and proper persons. Gifts to charity are generally exempt from inheritance tax, and leaving a sufficient share of an estate to charity can reduce the rate on the rest, which is why our wills and estate planning team often works with charity clients and donors.
Political campaigning is allowed, but it must further the charity's purposes and the charity must stay independent of political parties. Before an election, check the rules on non-party campaigning, which can require registration and spending controls, and keep a record of why campaign activity serves the charity's objects.
Setting up a charity: step by step
The steps below apply to a new charity in England and Wales. Charity solicitors in London can usually run the legal work in parallel with the founders' planning of funding and operations.
- Define the purposes. Draft objects that are exclusively charitable, clear and wide enough to allow the activities planned, with a clear statement of who benefits.
- Choose the structure. Decide between a CIO, a charitable company or a trust, considering liability, contracts, property and borrowing.
- Draft the governing document. Prepare the constitution, articles or trust deed, including trustee appointment, conflicts, powers to pay trustees and dissolution provisions.
- Appoint trustees. Check eligibility and disqualification, obtain declarations, and agree an induction covering duties and policies.
- Register. Incorporate at Companies House if needed, then apply to the Charity Commission with the governing document, financial information and trustee details.
- Register with HMRC. Apply for recognition for tax purposes so the charity can claim Gift Aid and reliefs.
- Put core policies in place. Adopt safeguarding, conflicts, financial controls, reserves, investment, data protection and serious incident reporting policies.
Risks and common mistakes
Not reporting serious incidents
Trustees are expected to report serious incidents, such as significant financial loss, fraud, safeguarding concerns or links to terrorism, to the Charity Commission promptly. Failing to report can itself be treated as mismanagement. The Commission's serious incident guidance explains what to report and when. Boards should have a clear internal process so incidents reach trustees quickly and a decision on reporting is made and recorded.
Unauthorised trustee benefits
Paying a trustee or a connected person, or contracting with a trustee's business, without proper authority is a breach of trust even if the price is fair. The trustee may have to repay the benefit. Check the governing document and the statutory power before any payment, follow the conditions precisely, and manage the conflict. Where in doubt, the Commission can authorise a benefit if it is in the charity's interests.
Disposing of land without following the rules
Sales, leases and other disposals of charity land must follow the procedure in Part 7 of the Charities Act 2011, unless an exception applies. The 2022 reforms simplified the process, but trustees still need appropriate advice on value and must include required statements in the transfer or lease. Disposals to connected persons need Commission consent. Getting it wrong can delay completion or undermine the disposal.
Mission drift
Charities sometimes expand into activities outside their objects, often for good reasons such as responding to a funder's priorities or a crisis. Spending outside the objects is a breach of trust. If the charity's work has evolved, amend the purposes using the statutory power or the governing document, with Commission consent where required, before committing funds to the new activities.
Mismanaging restricted funds and endowment
Donations given for a specific purpose create restricted funds that must be used for that purpose. Permanent endowment cannot generally be spent as income. Charities that use restricted money for general costs, or that do not track restrictions in their accounts, risk breach of trust and donor claims. The 2022 reforms provide more flexibility for small endowments and for borrowing from endowment, but the conditions must be met.
International grants without due diligence
Grants to overseas partners carry risks of diversion, fraud and sanctions breaches. Trustees must take reasonable steps to ensure funds are used for charitable purposes. That means partner due diligence, written grant agreements, monitoring and reporting, and checking sanctions and counter-terrorism rules. Our sanctions team advises where partners operate in sanctioned or high-risk areas.
Cross-border charities: Bangladesh and beyond
Many London charities and diaspora foundations fund education, health, disaster relief and community development in Bangladesh. A UK charity can make grants abroad or operate there directly, but the Bangladeshi side has its own rules. Organisations receiving foreign donations for voluntary activities in Bangladesh generally need registration with, and project approvals from, the NGO Affairs Bureau under the Foreign Donations (Voluntary Activities) Regulation Act 2016.
The practical structure is often a UK charity raising funds and claiming Gift Aid, making grants to a registered Bangladeshi partner under a written agreement with clear reporting obligations. Our Dhaka office advises on the Bangladeshi registration and compliance side, and our UK–Bangladesh team coordinates the two.
The same principles apply to grant-making in the Gulf, South Asia and elsewhere: due diligence on partners, compliance with UK sanctions and counter-terrorism law, transparent reporting to trustees and donors, and local advice where local law governs registration or the receipt of foreign funds. Families with assets in several jurisdictions sometimes combine a UK charity with foundations elsewhere, which raises questions of tax recognition and control.
How TRW & Co helps
As charity solicitors in London, we provide practical advice to boards, founders and donors. Typical workstreams include:
Establishing charities and foundations
We advise on structure, draft governing documents and handle Charity Commission and HMRC registration, including for corporate and family foundations.
Governance and trustee advice
We advise boards on duties, conflicts, trustee payments, delegation and governing document amendments, and run governance reviews.
Fundraising, trading and partnerships
We draft commercial participator and fundraising agreements, sponsorship deals and trading subsidiary arrangements, and review campaigns for legal risk.
Regulatory issues and investigations
We advise on serious incident reports, Commission engagement and statutory inquiries, and act in disputes. Where advocacy in the higher courts is required, we instruct specialist counsel.
Mergers, property and restructuring
We advise on charity mergers, incorporations, land disposals, permanent endowment and the closure of charities that have fulfilled their purposes.
Philanthropy and legacies
We advise donors on gifts, legacies and tax-efficient giving, and act for charities on legacy administration with our contentious probate team where disputes arise.
See all our services on our practices page, or contact our London office to discuss your charity.
Checklist for trustees and founders
Use this list to check whether your charity is on a sound footing, and involve charity solicitors in London where the answer is unclear:
- Are the charity's purposes up to date and do its activities fall within them?
- Is the structure still right for the charity's size, contracts and risks?
- Do you know which accounting and examination thresholds apply after the 2026 changes?
- Are conflicts of interest declared, recorded and managed, and are any trustee benefits properly authorised?
- Is there a process for identifying and reporting serious incidents?
- Are fundraising agreements in writing with the required content?
- Are restricted funds and endowment tracked and used correctly?
- For overseas work, is there partner due diligence, a grant agreement and sanctions screening?
- Does the charity need to register or report in Scotland, Northern Ireland or abroad?
Frequently asked questions
01Should we set up a CIO or a charitable company?
Both give the charity separate legal personality and limited liability. A CIO is registered only with the Charity Commission, which reduces administration, and must use a constitution based on the Commission's model framework. A charitable company is registered with both Companies House and the Commission, is widely understood by banks and landlords, and has a public register of charges. For charities planning to borrow or hold significant property, the company form is sometimes preferred; for many others, a CIO is simpler.
02When does a charity have to register with the Charity Commission?
A charity based in England or Wales must apply to register if its annual income is at least £5,000, or if it is a charitable incorporated organisation, which must register whatever its income. Some charities are exempt or excepted from registration, such as many universities and certain religious charities, and are regulated in other ways. Charities operating in Scotland or Northern Ireland may also need to register with the regulators there.
03Can a trustee be paid?
Trustees are generally unpaid volunteers, but payment can be lawful if authorised. The governing document may permit it, the Charity Commission can authorise it, and the Charities Act 2011 allows payment for services, and after the 2022 reforms for goods supplied with services, if strict conditions are met. Payment simply for acting as a trustee normally requires specific authority. In every case the conflict of interest must be managed and recorded.
04Has the audit threshold changed?
Yes. For financial years ending on or after 30 September 2026, the Charity Commission's guidance shows that an audit is required where income exceeds £1.5 million, or where income exceeds £500,000 and gross assets exceed £5 million. Independent examination applies above £40,000 of income. A charity's governing document, or a funder's conditions, may still require an audit below these levels, so check both before changing your arrangements.
05What is a serious incident and do we need to report it?
A serious incident is an adverse event, actual or alleged, that results in or risks significant harm to the charity's beneficiaries, staff, volunteers, assets or reputation. Examples include fraud, significant financial loss, safeguarding concerns and links to terrorism or other crime. The Charity Commission expects trustees to report serious incidents promptly. Failure to report can itself be regarded as mismanagement, so boards should have a clear reporting process.
06Can our UK charity fund projects in Bangladesh?
Yes, provided the funding furthers the charity's purposes and trustees take reasonable steps to ensure funds are properly used. That typically means due diligence on partners, a written grant agreement and monitoring. On the Bangladeshi side, organisations receiving foreign donations for voluntary activities generally need registration with the NGO Affairs Bureau and project approvals. Our London and Dhaka offices advise on both sides.
07Can a charity campaign on political issues?
A charity can campaign and engage in political activity if it furthers its purposes and the charity remains independent of political parties. It cannot have a political purpose or support a party or candidate. Activity around elections may also be subject to the rules on non-party campaigning, which can require registration and limit spending. Trustees should approve significant campaigns and record why the activity serves the charity's objects.
08Why instruct charity solicitors in London rather than a general firm?
Charity law has its own rules on purposes, trustee benefits, land, endowment, fundraising and regulation, and mistakes can expose trustees personally. Charity solicitors in London who work regularly with the Charity Commission, HMRC and fundraising rules can anticipate the regulator's questions. TRW & Co also brings international reach, including our Dhaka office, for charities working across borders. We do not promise outcomes, but we focus on sound process and clear advice.
Sources and official materials
- Charities Act 2011 — Main statute for charities in England and Wales
- Charities Act 2022 — Reforms to governance, land, endowment and trustee payments
- Charity accounts: threshold changes at a glance — Accounting thresholds for years ending from 30 September 2026
- Register your charity (GOV.UK) — Registration threshold and process
- The essential trustee (CC3) — Charity Commission guidance on trustee duties
- How to report a serious incident in your charity — Charity Commission serious incident guidance
- Fundraising Regulator — Code of Fundraising Practice
- Claim Gift Aid (GOV.UK) — HMRC rules on Gift Aid claims
General information only, current as at 21 October 2026. It is not legal advice and does not create a solicitor–client relationship. It reflects the law of England and Wales unless stated otherwise; Scotland and Northern Ireland have separate legal systems, and the law changes frequently. Check current official sources and take advice on the facts of your matter.