Government Publishes Analysis Report Of Charity Annual Returns For 2024

The Government has published its analysis of data from charity annual returns for the financial year ending 2024, representing the most comprehensive dataset available on the charity sector in England and Wales. The report uses data from 106,973 annual returns to analyse data regarding charity governance, finances, and people. The report also uses data from the Register of Charities to note a slight increase in the number of charities registered with the Charity Commission, from 168,893 in 2023 to 171,173 in 2024.

Charities spent £100bn on delivering vital societal impact in 2024 – representing a 5% increase from 2023 and exceeding the 2.5% increase in the consumer price index for the same period. Increased expenditure was matched by a 5% growth income to £102bn, a third of which was from donations and legacies from the general public.

The report analyses the distribution of income and expenditure across the sector, finding that three in five charities that submitted an annual return for 2024 had an income of less than £100,000. Conversely, charities with an income above £500,000 made up 13% of all charities but accounted for 92% of both total gross income and total gross expenditure in the sector.

The report also finds that a tenth of charities reported overseas spending, with £0.43bn more spent outside the UK than received into the UK by registered charities. The United States received the most funds from UK charities, but the top countries for total income from outside the UK differed between England (the United States) and Wales (India).

Charities were asked in the 2024 annual return if they were part of a wider group structure, as the Government sought to understand the scale of these relationships in the charity sector. The report shows that the vast majority charities are independent, with just 1 in 10 charities being part of a federated structure (most of which are charities with an income above £500,000).

The analysis does indicate the ongoing financial squeeze in parts of the sector, finding that the margin between income and expenditure across the sector has improved but not yet recovered to pre-pandemic levels. Smaller charities were found to operate on the narrowest margins, with only 25% of charities with an income of £10,000 or less breaking even. There were also fewer jobs reported in 2024 than in 2023.

The Chief Executive of the Charity Commission, David Holdsworth, noted that 'charity leaders up and down both countries continue to tell us they are under considerable financial pressures' and recommended that trustees plan and act on any 'early warning indicators' to manage their finances, such as using the Commission's online finance toolkit.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.