Skip to main content

What government support is available to charities?

What government support is available to charities?

INSIGHTS CHARITY SECTOR SPECIAL
15 May 2020: Philippa Kelly, Director of ICAEW’s Technical Strategy Business Group, looks at the business support available for charities. 

Early in the coronavirus crisis, the government announced funding for charities comprising £360m to be directly allocated to charities providing key services (including hospices, St John’s Ambulance, victims charities, vulnerable children’s charities and Citizens Advice), and £370m for small and medium-sized charities.

However, many are facing financial challenges and will need additional support. Much of the support available to businesses can also be used by charities. If not already considered, the following schemes and mechanisms may allow charities to continue operating through the crisis and beyond.

Charities can access the government-backed loan schemes, and the criteria are flexed to reflect the activities of a charity. Charities are not required to confirm that more than 50% of the income of the business (together with that of any member of any group of which it is a part) is derived from its trading activity, as long as they meet the other criteria. The “business in difficulty” criteria or the accumulated losses test do not apply if the charity is a trust or unincorporated association.

For charities in acute financial difficulties, speak to your independent examiner or auditor as a source of advice, as there may be other options available. If you have existing debt, talk to your lender about payment holidays or restructuring. If you have insurance which is not required due to the effects of coronavirus, speak to your insurer about how you best receive the benefit of the premiums, or potentially a refund.

Charities may also be able to amend restrictions to funds due to the current extreme circumstances, allowing them to access cash they would not otherwise be able to, however, this should only be considered if other options are not possible, and there may be longer term impacts, including on financial resilience and donor relationships.

The Charity Commission has further guidance if you are in more severe financial difficulties.

Comments

Popular posts from this blog

Japan's economy falls into recession

Japan's economy falls into recession as virus takes its toll 18 May 2020   62 comments Share this with Facebook   Share this with Messenger   Share this with Twitter   Share this with Email   Share Related Topics Coronavirus pandemic Image copyright GETTY IMAGES Japan has fallen into recession for the first time since 2015 as the financial toll of the coronavirus continues to escalate. The world's third biggest economy shrank at an annual pace of 3.4% in the first three months of 2020. The coronavirus is wreaking havoc on the global economy with  an estimated cost of up to $8.8tn (£7.1tn) . Last week, Germany slipped into recession as more major economies face the impact of sustained lockdowns. Japan did not go into full national lockdown, but issued a state of emergency in April which severely affected supply chains and businesses in the trade-reliant nation. Coronavirus pushes German economy into recession What shape will the coronavirus recession be? Cor...

Meet five advisers who’ll help your business become ‘fit for finance’

Meet five advisers who’ll help your business become ‘fit for finance’ Charlie Gilbert Content Manager Enterprise Nation   In our previous post, we covered the topic of  how to use any money you raise  – with the services of advisers being a crucial area small businesses should consider investing in. These services, however, are often needed before a business applies for funding. Take financial advisers and accountants, for example. Their job isn’t solely about helping you keep on top of your incomings and outgoings; it’s also about making you ‘fit for finance’ – in other words, helping position you as an attractive prospect to lenders or investors. They do this in myriad ways – from increasing profitability by helping you run your business more efficiently, to improving cashflow by advising on, and helping you implement, processes that keep cash in your business (automated payment collections, for example, or credit control). Some advisers will ensure you’re set up to sca...

Employees fearful about return to work

Employees fearful about return to work - survey More than half of the UK’s workforce is not ready to return to work - with many being anxious or deeply concerned, according to a new survey. In a new report by workplace wellbeing specialists, BHSF, 45 per vent described their feelings about the return to work negatively. Only five per cent of employers have put in extra employee support services for those returning to a more normal work pattern. Challenges facing businesses are compounded by the fact that not all staff are comfortable raising health concerns with their line managers. Almost one-third (30 per cent) confirmed they would not feel comfortable discussing any mental health, physical health, grief or financial concerns with their line manager. When looking at concerns where workers are comfortable disclosing with their line managers, the reading is equally alarming. Only 41 per cent said they would discuss mental health concerns with their manager, while even fewer would discu...