Updated Charity Commission Guidance – Trustee Expenses
The Charity Commission has released updated guidance titled ‘Trustee Expenses: What Charities Can Pay’. The updated guidance aims to provide clearer instructions for charities regarding trustee expenses, and has been published as part of a broader update to the Commission’s ‘CC11 guidance’, which addresses various scenarios involving trustee payments.
The new guidance emphasises, that expenses, which can legitimately be reimbursed to trustees, are not considered ‘trustee payments’ or ‘trustee benefits’ and do not require Charity Commission approval. Common reimbursable expenses include travel costs to trustee meetings, costs of overnight accommodation, or the cost of food and drink during a trustee meeting. However, the Commission underscores that these expenses must be reasonable, not excessive, and properly incurred.
To promote transparency and accountability, the Commission advises charities to establish a comprehensive trustee expenses policy. Such a policy should outline the claimable expenses for trustees, as well as the required evidence for claims. For larger expense claims an approval process should also be put in place.
Implementing a clear expenses policy can help attract and retain trustees, by ensuring that they are not financially disadvantaged by providing a voluntary service.
Paul Latham, Director of Communications & Policy at the Charity Commission have stated, that:
“The charity sector is founded on public trust – and voluntary trusteeship is a key component of that. The vast majority of trustees are unpaid and give their time willingly and enthusiastically … Expenses are not a form of trustee payment, those are a reimbursement of the reasonable costs incurred to perform that role. … Whilst trustees are not required to claim them, in making clear that trustees can do so, charities may avoid putting off good candidates from joining their board because of the financial impact.”
The new guidance can be found here: Trustee expenses: what charities can pay - GOV.UK
If you have queries in relation to trustee payments, please contact Khalid Sofi at khalid.sofi@lbmw.com or Anna Ratkai at anna.ratkai@lbmw.com.