30 October 2026

The charity thresholds have gone up, and there is a new SORP: what it means for a PTA

Two things have changed for charities in England and Wales. The income thresholds that decide whether your accounts need an independent examination, and whether you can prepare receipts and payments accounts, have gone up for financial years ending on or after 30 September 2026. And a new Charities SORP applies to financial years beginning on or after 1 January 2026. The thresholds are the change most likely to matter to a PTA, so this post starts there.

The new thresholds

For a financial year ending on or after 30 September 2026:

• ·Independent examination is needed once gross income is over £40,000. It was £25,000.
• ·Receipts and payments accounts can be prepared with gross income of up to £500,000. It was £250,000.
• ·A qualified examiner, a member of one of the listed professional bodies, is needed once gross income is over £500,000. It was £250,000.

Gross income is everything that came in, before anything came off it: donations, grants and the full takings from every event. Our post on the CC16a goes through it in more detail.

It goes by when your year ends

The new figures apply to a financial year that ends on or after 30 September 2026. A PTA whose year ended on 31 August 2026 uses the old figures for that year, and its first year on the new ones is the year ending 31 August 2027. A year ending on 31 December 2026 uses the new ones.

If your income is between £25,000 and £40,000

For a year on the new figures, the law no longer requires an independent examination of your accounts. Your constitution may still require one, so check it before anything changes, and some committees keep an examination anyway because it is a second pair of eyes on the money. Either way it is the trustees’ decision.

These changes are for England and Wales. Scotland and Northern Ireland set their own limits, which OSCR and the Charity Commission for Northern Ireland publish.

And the new SORP

SORP stands for Statement of Recommended Practice. It is the rulebook for charities that prepare accruals accounts: the kind that count income when it is earned and costs when they are incurred, and that end with a balance sheet. It sits on top of the accounting standard FRS 102, and it is the reason larger charities’ accounts look the way they do.

Does the SORP apply to your PTA?

This is only about the SORP. The thresholds above apply to a PTA in England and Wales whatever kind of accounts it prepares.

The SORP applies only if your PTA prepares accruals accounts. It says so itself: a charity that prepares receipts and payments accounts is not required to apply it. Receipts and payments accounts are the simpler, cash-based kind, and the CC16a is the Charity Commission’s template for them.

In England and Wales a charity can prepare receipts and payments accounts if all of these are true:

• ·its gross income for the year is no more than £500,000 (£250,000 for a year ending before 30 September 2026)
• ·it is not a company
• ·its governing document does not require accruals accounts

Most PTAs meet all three with room to spare, and receipts and payments is a lot simpler. You record money when it comes in and when it goes out. There is no balance sheet, nothing to accrue and no SORP to follow.

So if your PTA prepares accruals accounts, it is worth asking why. There may be a good reason: the PTA may be a company, or its constitution may require them. Sometimes it is just how the accounts have always been done. If none of the three conditions rules receipts and payments out, the trustees can choose it, and your independent examiner, if you have one, is the person to talk it through with.

One thing to watch. The SORP’s own list of who must prepare accruals accounts still gives England and Wales the old £250,000 figure, because it was finished before the limit went up. For a year ending on or after 30 September 2026, go by £500,000.

What changed, if you do prepare accruals accounts

The changes are real, but most of them are about things a PTA rarely has: leases, investments, legacies, pension schemes and groups of charities. The ones most likely to matter:

• ·Three tiers by income. Up to £500,000 is tier 1, up to £15 million is tier 2 and anything above that is tier 3. How much you have to disclose depends on your tier.
• ·Impact reporting is now a must. The trustees’ report has to explain the difference the charity is making, not just what it did.
• ·Environmental, social and governance reporting. Required in tier 3 only. Below that it is optional.
• ·Income from selling things. New guidance on when it counts as income, following changes to FRS 102. Gifts and grants are dealt with separately.
• ·Cash flow statements. The SORP now asks for one only in tier 3, where it used to ask every charity over £500,000.
• ·A definition of reserves. More on that below.

If your PTA does prepare accruals accounts, your examiner or accountant will know what the new SORP means for them.

Two ideas worth borrowing anyway

Reserves means money you are free to spend. Money given for a purpose (a restricted fund) is not reserves, and nor, normally, is money the committee has set aside and committed to a project. So when your reserves policy says “we aim to hold £3,000”, compare that with what is left once that money is taken off, not with the bank balance. A PTA with £8,000 in the bank and £5,000 of it given for the playground holds £3,000 of reserves.

Say what difference it made. For a PTA that is a sentence or two on what the money changed for the children: more books going home, a playground they can use all year. It is the part of the report a parent remembers.

Our post on the Trustees’ Annual Report covers both, with a prompt that drafts the report for you.

How Treasurer’s Ledger does this part

Year-End Close produces receipts and payments accounts in the CC16a layout. Key dates on the Dashboard goes by your year end, so its independent examination reminder uses the threshold for that year. The Dashboard also compares your reserves target with your free reserves, after money in restricted funds and money set aside. It does not produce accruals accounts.

This page is general information about the 2026 changes to the England and Wales thresholds and the Charities SORP 2026, not advice about your charity. The full SORP and the Charity Commission’s guidance are free to read online, and your independent examiner is the right person to ask about your particular accounts.