Coronavirus: Charities and Not for Profits

In the current situation, it will be the charity sector that will be called upon to support people impacted by Coronavirus (COVID-19). This will increase demand on services at a time when income will be reducing.  There will be increased pressure on Trustees and Management teams to make difficult decisions.

Aid package announced on 8 April

A £750m aid package for charities was announced by the Chancellor on 8 April, including hospices and those supporting domestic abuse victims. 

The focus is on helping those providing vital services to meet the increased demand they are facing due to the virus, as well as helping them continue to run their day to day activities.

The package is made up as follows: 

  • £360m in cash grants to charities providing key services and supporting vulnerable people. This funding will come direct from government departments 
  • £370m to small / medium local charities on the front line of the crisis, providing food, medicines and financial advice. This will include funding through a grant to the National Lottery Community Fund 
  • The matching of all donations raised at the BBC’s Big Night In fundraising event on 23 April, with a minimum of £20m to the National Emergencies Trust appeal. 

Those benefitting from the £360m allocation will include hospices, St Johns Ambulance, victims charities, including domestic abuse, vulnerable children charities and Citizens Advice Bureau. Relevant government departments will aim to identify the priority recipients so that they receive their money quickly in the coming weeks. The application process for the National Lottery Community Funding should also be operational within weeks. 

Government support

The government have confirmed that some charities can claim Gift Aid on payments for cancelled events. For the duration of the coronavirus outbreak, if someone chooses not to claim a refund for a cancelled charity event, the value of the refund will be treated as a donation and therefore be eligible for Gift Aid. This change will also apply to theatres and other cultural venues recognised as charities.

If a charity needs to delay the filing of their annual return they can ask for an extension. Charities will also be able to benefit from some of the wider measures introduced by the Chancellor on 17 March.

We are also starting to see appeals for donations to response and recovery funds and the charity the National Emergencies Trust.

Charities may also be able to benefit from some of the other COVID-19 measures already in place, including in particular the Job Retention Scheme, although care must be taken when assessing eligibility of this Scheme where the charity receives significant public funding – the devil is in the detail.   

Charity Commission guidance

The Charity Commission has issued some guidance for charity trustees in dealing with meetings and compliance matters. This covered:

  • Meetings (including the AGM): These should be cancelled or postponed if following the government’s health advice leads you to this conclusion, with the decision minuted to show good governance.
  • Annual reports: Every effort should be made to file annual reports on time, but the Commission has promised to be pragmatic in dealing with cases where this is not possible, and charities should contact the Commission if there will be an issue with meeting filing deadlines. The number is (0300 066 9197).
  • Virtual meetings: Remote meetings, via video or phone links may be used. Some charities governing documents allow this; if not they should document the reason and consider changing their rules for future meetings.
  • Reporting: Reporting requirements remain in place, including the reporting of serious incidents.

You can keep up to date with the Charity Commission’s guidance by clicking here.

Further guidance

  • The Charity Tax Group have released guidance on the various measures and support available for the charity sector. 
  • The National Council for Voluntary Organisations have released information to help charities covering protection of staff, volunteers and beneficiaries and contingency planning. 

Both of the websites are being regularly updated.

Additional advice

Advice has also been issued for the general public to try to ensure that their good intentions in giving to charities to help in the current crisis sees funds donated to genuine charitable organisations and not to those seeking to take advantage of the turmoil to defraud well-meaning givers. Further information on this can be found here.

We have set up a dedicated Coronavirus Hub to provide information to our clients as and when it is available. This will be updated as further guidance on support for charities is received.

If you would like to discuss anything further please get in touch with a member of our Charity and Not for Profit team