Background to the Charities Act 2022
Charities legislation is commonly perceived as being complicated, uncertain and in places unduly burdensome. This can delay or prevent a charity’s activities, discourage people from volunteering to become trustees and force charities to obtain expensive legal advice. In the Law Commission’s 2017 report “Technical Issues in Charity Law”, it therefore recommended reform of various technical areas in the law governing charities, with the aim of making it easier for charities to operate.
The Government’s response to that Law Commission report was published early in 2021. It accepted the majority of the Law Commission’s recommendations. In the Queen’s Speech in May 2021 the Government announced its plans to reform charity law and said that it aimed to “address a range of issues in charity law which hamper charities’ day to day activities”. A new Charities Act 2022 (“the Act”) received Royal Assent on 24 February 2022 to implement the recommendations that were accepted by the Government. The Act amends the Charities Act 2011 and other legislation. At the time of writing, some of the provisions of the Act have not yet been implemented. Where provisions have already been implemented, the following pages state the implementation date concerned in each case and provide information based on the law as it applies from that date onwards. We will update these pages as and when further implementation dates are known, and if any supporting legislation is subsequently passed which impacts on the Act's provisions.
The impact of the changes made by the Act will significantly improve the efficiency of the sector, release more funds for use on charitable purposes rather than administration, and reduce unnecessary and overly bureaucratic regulation that not only increases the sector’s costs but also is a factor in discouraging people from volunteering to become trustees.
The following pages outline below some of the changes to charity law made by the Act which will be of interest to charity trustees, charities, or those involved with charities as advisers. The Act also makes other changes to charity law. To find out about those other changes, or to go into the topics covered below in more detail, see either the Act itself (here) or explanatory notes to it (here) published by the UK Parliament when it was still in Bill form (i.e. before it received Royal Assent).