Responsibilities of a Registered Charity

Creating a Strategic Plan for your Charity

Download a free word template to help you establish the intial direction of your new Charity.

FREE STRATEGIC PLAN TEMPLATE DOWNLOAD: 

Initial Strategic Plan for Charities UK 2017 IN2ACCOUNTING>>

A Basic Strategic plan for a New Charity will likely prove useful to provide initial direction to Board members and key staff when applying for any start-up funding, and for recruiting new Board members. The plan should be updated by conducting more complete strategic planning later on, probably in three to six months.

This round of planning will likely be short-term and primarily internally focused.

The next round of planning will include much strategic thinking and analyses, especially with stakeholders input. For now, the plan need not be very comprehensive and detailed, for example, it might be three to five pages in length.

1. On the first page, write down the 5- to 8-sentence mission statement that you crafted earlier.

2. Then list 5-8 goals that must be achieved over the next year in order to get the nonprofit  started. For example, goals might include getting and developing Board members, getting facilities, getting and developing staff to provide services, advertising to groups of clients, serving clients and doing fundraising.

3. For each goal, write down 4-5 objectives, or smaller goals, that must be accomplished in order to achieve the overall goal.

4. For each objective, write down what resources might be needed, who will achieve the objective and by when. Do not worry that this information has to be accurate throughout. You can change it later as needed.

 

FREE STRATEGIC PLAN TEMPLATE DOWNLOAD: Initial Strategic Plan for Charities UK 2017 IN2ACCOUNTING

What are Charity Trustees?

Charity trustees are the people who have the general control and management of a charity’s administration:
in short, they are ultimately responsible for the charity. They may also be known as the board, the management committee or the directors.

 

Who can be a Trustee? 

Every charity has a “governing document” (often called the ‘constitution’) which sets out how it will be run, including how new trustees are to be appointed. In theory, anyone can become a trustee, although the charity’s constitution may impose some restrictions. Some people are legally disqualified from acting as a trustee, for example people who have been convicted of an offence involving dishonesty or deception.

 

Key duties of charity trustees: 

  • Trustees are responsible for the proper administration of their charity
  • Trustees must accept ultimate responsibility for everything the charity does
  • Trustees have to act reasonably and prudently in all matters relating to their charity
  • Trustees must safeguard and protect the assets of the charity
  • Trustees have a duty to act collectively as Decisions and responsibilities are shared, so all trustees should take an active role.
  • Trustees must act in the best interests of their charity The interests of the charity are paramount. Trustees should not allow their personal interests or views to override this: they must exercise independent judgement.
  • Trustees must avoid any conflict between their personal interests and those of the charity The main implication of this is that the scope for trustees to benefit personally from their charity is very limited. Trustees must deal appropriately with any conflicts between their own personal interests and those of the charity. They must also be alert to possible conflicts between duties they may owe to other organisations and the duties they have to the charity.

Need more information? Get in touch with our dedicated Charity Accounting Team for more information.

Writing an Employment Contract

What to include in a contract:

A contract would need set out the terms you require and would need to be offered to and accepted by your employee. This is a simple example of terms that would be expected to be included in an Employment Contract.

  • your businesses name and address
  • the name of the employee
  • the date their employment begins
  • Details of the contract length (permanent or fixed term)
  • how much and when the employee will be paid e.g. weekly or monthly
  • hours of work
  • holidays and holiday pay, annual leave entitlements
  • job title and job description
  • Terms and conditions of Employment Contracts
  • Details of the Company’s discipline and grievance procedures

Learn more about contracts and how to make one on the ACAS website: http://www.acas.org.uk/index.aspx?articleid=1461

 

Other Points which may or may not be applicable to you include:

  • Sick leave and sick pay
  • Details of any probationary period – (a probationary period can be a good idea)
  • Information on overtime, time off in lieu or flexible working arrangements
  • Confidentiality and data protection
  • Expenses
  • Maternity, Paternity, Parental, Shared Parental & Adoption leave  Notice requirement

 


 

While a Contract of Employment is not a legal requirement in most cases, it could prove to be advantageous. Having a contract will protect you and your business in a number of ways, most notably because the employee will be bound by the terms of the contract.

If the work the employee engages in involves dealing with confidential information about your business, your products or your clients, a contract gives you the platform to specify clauses in the contract which prevent the employee from divulging this confidential information even after their employment contract has ended.

A contract can set out the length of the contract and the period of notice (ie, time before leaving the position). Having an employee agree to these conditions in a contract can give you greater control over their ability to leave their position and your ability to terminate their contract. For example, setting an initial contract 90 days term will give you the option to extend or terminate this contract without difficulty after the 90 day period, depending on the performance of the employee. It will also protect your business from employees leaving without giving appropriate notice.

Other clauses that can set out include, start and ending of a working day, expected appearance, expected performance level. These all allow you to terminate employment if any of the clauses are not met.

Today, most employees would prefer to have a Contract of Employment in place before commencing employment. An Employment Contract is also seen as a certain security in their position and helps attract talent.

Download Sample UK Contract

Download this employment contract to get an idea of the issues you will be required to address when you are producing your own employment contracts.

Accounting Periods for Companies

What is an Accounting Period?

An accounting period is a period of time ending on your company’s financial year. It is usually around 12 months. It is an important date  for every Limited Company, because it decides your deadlines relating to corporation tax and annual accounts.

The tricky part about the Accounting Period, is that Companies House and HMRC have different requirements for your Accounting Period.

 

The Significance of an Accounting Period

The accounting period your company choose has an impact on your deadlines and the manner in which you which prepare your returns to both Companies House and HMRC.

It affects: 

  • The deadline for your Annual Accounts to be submitted to Companies House
  • The deadline for your Corporation Tax Payment to reach HMRC
  • The deadline for your Corporation Tax Return to reach HMRC

So it is an important date and one which requires  planning and consideration when you form a company, or if you decide to change your Company Accounting Period.

 

Your First Accounting Period

When you first incorporate your company, Companies House and HMRC will automatically issue you with your Accounting Year End (Also known as your Accounting Reference Date).

It will span a period between the date you incorporated your company and your Accounting Reference Date. It is likely to be more than 12 months due to the manner in which Companies House automatically generates your Accounting Reference Date.

 

Accounting Period for Companies House

  • It can be more than 12 months
  • It can be less than 12 months
  • The end of your accounting period is known as your Accounting Reference Date/Year End/Financial Year End
  • Your Company Accounts will be prepared based on all financial information within this period.

For example, if your accounting period is from the 1 January 2014 to 31 January 2015(13 months), all the transactions you entered into during these  dates would be summarised to create your annual accounts. The Annual Accounts include your Profit and Loss statement, Balance Sheet, Statement of Capital and Notes to the accounts.

 

Accounting Period for HMRC 

  • It can be less than 12 months
  • It CANNOT be more than 12 months
  • It is determined by your Accounting Year End date

The end of your accounting period or your accounting year end will determine when your Corporation Tax Return and Corporation Tax Payment is Due to be submitted to HMRC.

 

The Tricky Bit

If you prepared your Annual Accounts for a period greater than 12 months (ie in the example above it is 13 months) You need to submit 2 separate Corporation Returns, following the example above: 

  • The first Tax Return covering 12 months (1 Jan 2014 to 31 Dec 2014)
  • The second Tax Return covering 1 month (1 Jan 2015 to 31 Jan 2015)

If your Accounting Period is actually less than or equal to 12 months, you will have only 1 corporation tax return as normal.

Registering for Corporation Tax

Registering for Corporation Tax is a simple online procedure, but it is vital that it is performed in time and with accurate information. All our Limited Company Packages include registering for Corporation Tax on your behalf as your tax agent with HMRC.

 

When to register?

You need to register your company within 3 months of starting your business. Starting your business means buying, selling, employing staff, advertising your products/services or renting for business purposes etc

 

Information you will need to complete a corporation tax registration

  • UTR number (unique tax reference number)
  • the date you started to do business (this will be the start date of your company’s first accounting period)
  • your company name
  • company registration number
  • your business trading address (ie where you work from)
  • your business activity
  • your accounting reference date (the date you make your accounts up to)
  • the name and home address of the company directors

 

UTR Number

Your UTR number will automatically be sent to, usually within 2 weeks of forming your limited company. HMRC is automatically informed of your companies registration and will send your UTR number by post to your registered company office address.

Accounting Period

Your accounting period is a time period that you choose to run your accounts to and is usually 12 months or a year (it cannot be more than 12 months for Corporation Tax purposes – so if your Accounts did span a period over 12 months, you may need to submit 2 tax returns, with the second tax return covering the period in excess of 12 months)

Employee Verification Checks

There are a variety of Employee Verifications you may need to do, or in some cases you may not need any. However, it is recommended that at the very least Work References be requested.

The verifications you choose to do will depend largely on the industry you operate in and your attitude toward the risk of hiring a new employee.

For example, working with children or the elderly will require a mandatory CRB check. You can learn more about CRB checks and get started on it here>

Checking whether your employee has the legal right to work in the UK is your responsibility  and the consequences of not being vigilant about this could lead to fines of up to £10000 or worse. For more guidance on how to assess if someone has the right to work in the UK, head on over to the following website: https://www.gov.uk/legal-right-work-uk.

Common types of employee verifications

  • Medical History
  • Employment Verification
  • Education Verification
  • Professional Licensing Verification
  • Personal References
  • Drug Screening
  • Driving Record
  • National Sex Offender Registry

Director Responsibilities

Duties of a UK Limited Company Director

The overriding requirement of a director is to act in the best interest of the company as opposed to the interests of third parties or even shareholders. The Companies Act 2006 sets out a statement of a director’s duties, here are the key points:

  • Duty to act within their powers
  • Duty to promote the success of the company
  • Duty to exercise independent judgement
  • Duty to exercise reasonable care, skill and diligence
  • Duty to avoid conflicts of interest
  • Duty not to accept benefits from third parties
  • Duty to declare interest in a proposed transaction or arrangement

 

Other Director Duties

You must comply with employment law in dealings with employees.

Avoid unfair dismissals, discrimination or any other inappropriate work practices, such as unequal pay.

Act quickly to ensure the company complies with any new employment laws.

You must take reasonable care to ensure the health and safety of your employees.

You must undertake a risk assessment.

If you have five or more employees, you must record this in writing and have a written health and safety policy.

Pay the correct amounts of tax, VAT and National Insurance on time.

Consider data protection policies for the company

Not provide misleading information

Ensuring that the statutory returns are filed with the Registrar of Companies on time

Sign a declaration acknowledging responsibilities relating to accounting records and the accounts in general

Ensure that the company’s business stationery, website, order forms and emails carry its name, registered number, country of registration and registered address

 

Director Consequences for Misconduct or Breech of Duties

Directors could be held personally liable for losses in certain circumstances such as:

  • wrongful or fraudulent trading (ie. allow the business to carry on and incur debts when you know there is no reasonable prospect of repaying them)
  • acts beyond your powers or undertaken with insufficient skill and care
  • in breach of their duties or responsibilities stated above

So despite being the director of a Limited Liability Company Company, if you are not fully aware of and do not adhere to, the expectations placed upon you, you may find yourself personally liable for Company debts.

Twitter Feed

- 306 days ago

RT @Surailian: Buckingham Palace repairs £369m, Westminster repairs £4b, Royal Wedding £24m, New chemical weapons centre £48m Hungry Childr…
h J R

- 306 days ago

Morning guys. If you're a sole trader or small business and need advice on how to cut costs, grow your business or… https://t.co/cG7RifA99G
h J R