Posted: 27 / 07 / 2023

Article by: Emma Houghton, Head of London Charity and Compliance


On 31 October 2022 and 14 June 2023, key changes to the Charities Act 2011 were introduced.

We’ve summarised the key changes here to help your charity stay on top of the legislation…


14TH JUNE 2023

Selling, leasing, or otherwise disposing of charity land.

There are legal obligations that charities must meet before they dispose of charity land. These requirements have now been simplified and state the following:

  • The category of designated advisers who can provide charities with advice on certain disposals has been widened.
  • Trustees, officers, or employees are confirmed to be able to provide advice on a disposal if they meet the relevant requirements.
  • Trustees have the discretion to decide how to advertise a proposed disposal of charity land.
  • The requirement for charities to get Commission authority to grant a residential lease to a charity employee for a short periodic or fixed-term tenancy has been removed.

Although not in place yet, the provisions relating to the following are expected to be implemented by the end of 2023:

  • Disposals by liquidators, provisional liquidators, receivers, mortgages, or administrators.
  • The taking out of mortgages by liquidators, provisional liquidators, receivers, mortgages, or administrators.
  • What must be included in statements and certificates for both disposals and mortgages.

Further information is listed here.


Using permanent endowment.

This is property that your charity is required to keep and is not allowed to spend. There are now statutory powers to enable charities in certain circumstances to spend from a ‘smaller value’ permanent endowment fund of £25,000 or less without Commission authority, as well as certain charities to borrow up to 25% of their permanent endowment fund without Commission authority.

However, charities that cannot use statutory powers will require Charity Commission authority.

Additionally, a new statutory power allows charities that have opted into a total return approach to investment to use permanent endowment to make social investments with a negative or uncertain financial return, as long as any losses are offset by other gains.

For more information see here and here.


Charity names.

Charity names which are either offensive or misleading or are too similar to another charity’s name can now be directed to change their name by the commission.

The Commission can now:

  • Direct a charity to stop using a working name if it is too similar to another charity’s name or is offensive or misleading. A working name is any name used to identify a charity and under which the activities of the charity are carried out. For example, ‘Comic Relief’ is the working name of the charity ‘Charity Projects’.
  • Delay registration of a charity with an unsuitable name or delay entry of a new unsuitable name onto the Register of Charities.
  • Use its powers in relation to exempt charities in consultation with the principal regulator.

For more information, please see here.

Additionally, the language used to define a connected person has been updated.


31ST October 2022

Paying Trustees for providing goods or services.

Charities now have statutory power in certain circumstances to pay trustees for providing goods alone to the charity. This includes:

  • Services only, such as consultancy.
  • Services and associated goods, such as construction and the associated materials.
  • Goods only, for example supplying computer hardware to the charity.

For more information see here and here.


Fundraising: Raising too much or not enough.

Trustees’ obligations when appeals either raise too much, not enough, or the funds raised cannot be spent as originally intended have been simplified.

When fundraising for a specific purpose, charities are required to state a ‘secondary purpose’, for example, that the funds will be used for a different project should it not be possible to use them for the primarily stated purpose.

Should your appeal not raise sufficient funds or can no longer spend the funds on the intended purpose, you may be required to send and agree a plan for offering to return donations to the Charity Commission of England and Wales.

Excess funds are more straightforward but are still subject to legal requirements.

See here for more information about funds that can’t be spent as they were intended.


Power to amend Royal Charters.

Some charities now have a new statutory power to change sections in their Royal Charter with approval from the Privy Council. More information is available here.

The following changes are also now in effect:

  • The Charity Tribunal can make “authorised costs orders” following an application by a charity. More information is available here.
  • The Commission’s scheme-making powers include schemes for charitable companies.
  • Trust corporation status is automatically conferred on existing and future corporate charities with regards to any charitable trust of which the corporation is (or, in the future, becomes) a trustee.
  • Provisions relating to giving public notice to written consents and orders of the Charity Commission under various sections of the Charities Act 2011 have been updated.
  • Amending governing documents by parliamentary scheme under section 73 of the Charities Act 2011, will by default always be under a lighter touch parliamentary process (known as the negative parliamentary procedure).