Useful numbers. Better decisions.

Clear, current information for business owners, directors, trustees and leaders of purpose-led organisations.

The figures below reflect the 2026/27 UK tax year and the position at 14 August 2026. They are a useful starting point—not a substitute for advice based on your circumstances. Scotland has different income-tax bands.

15

Neither structure is automatically better. The right answer depends on who should control the organisation, how profits will be used, what funders expect and whether the founders may eventually sell or attract investment.

A CIC is still a company—not a charity—and does not automatically receive charitable tax reliefs. A charity or CIO has a different legal purpose, trustee duties, tax treatment and regulatory framework. Choosing the structure before thinking through funding, control and exit can be expensive to unwind later.

SORP 2026

The new Charities SORP applies to reporting periods starting on or after 1 January 2026 for charities preparing accruals accounts.

Key changes include:

• three reporting tiers—up to £500,000 income; £500,000 to £15 million; and over £15 million;

• new accounting requirements and examples for income and leases;

• refreshed Trustees' Annual Report guidance covering reserves, future plans, impact and ESG;

• simplified reporting for social investments; and

• clearer treatment of provisions and contingencies.

ACCOUNTING THRESHOLDS

Changes are expected from 30 September 2026 for accounting years ending on or after that date. The proposed new thresholds include:

• independent examination from income over £40,000 rather than £25,000;

• a professionally qualified independent examiner from income over £500,000 rather than £250,000; and

• receipts-and-payments accounts available to non-company charities below £500,000 income rather than £250,000.

CONFLICTS OF INTEREST

The Charity Commission refreshed its conflicts guidance in April 2026. Trustees should identify conflicts early, record them, exclude affected people where appropriate and show clearly why each decision is in the charity's best interests.

WHAT TRUSTEES SHOULD DO NOW

• Confirm which SORP tier and reporting threshold will apply.

• Update the year-end timetable and trustee-report template.

• Review reserves, going concern, leases and income recognition.

• Refresh the conflicts register and decision-making process.

• Make sure the board pack links financial performance to impact, risk and future sustainability.

13-WEEK CASHFLOW

A short-term cash forecast shows when money is actually expected to arrive and leave—not merely when income and expenditure appear in the accounts. Update it weekly, model a realistic downside and assign an owner to every material assumption.

A DECISION-READY BOARD PACK

A useful monthly pack should show:

• cash, runway and a rolling forecast;

• actual performance against budget and the latest full-year outlook;

• restricted and unrestricted funds where relevant;

• key drivers, risks, opportunities and actions;

• reserves against the agreed policy; and

• a small number of operational and impact measures.

FINANCE-FUNCTION WARNING SIGNS

Transformation may be needed where reporting takes more than ten working days, reconciliations are incomplete, teams maintain competing spreadsheets, margins cannot be explained, cash is repeatedly surprising or leaders do not trust the numbers.

THE FIRST 100 DAYS AFTER AN ACQUISITION

Prioritise cash visibility, opening-balance validation, a single chart of accounts, customer and supplier controls, consistent revenue and margin reporting, systems ownership and a clear timetable for integrating people and processes.

MAKING TAX DIGITAL AND DIRECTOR VERIFICATION

Our dedicated MTD and Director Verification page explains the phased Income Tax thresholds, digital-record requirements and Companies House identity checks. Awake is a registered ACSP and can provide supported director and PSC verification where clients prefer help rather than the free direct route.

RESERVES AND SUSTAINABILITY

A reserves policy should be linked to genuine risks, committed costs, income concentration, notice periods and the time needed to respond—not selected as an arbitrary number of months. The board should see both the policy target and the expected future position.

Need a template, diagnostic or board working session? Awake can turn any of these resources into a practical tool for your organisation.