Raising Money for Charity: New Joint Guidance from the Charity Commission and Fundraising Regulator
This month, the Charity Commission has published new guidance, in collaboration with the Fundraising Regulator, setting out the key points to consider when raising funds for charity. The guidance is aimed at both individuals and organisations and is designed to ensure that fundraising is carried out safely, lawfully and in a way that protects public trust and confidence in charities. We have summarised the main takeaways below:
Running a Successful and Lawful Fundraiser
1. Choose Your Charity Carefully
Before you start collecting donations, decide which charity you want to support. Selecting a specific, registered charity makes it clearer for donors and can boost the effectiveness of your efforts. You can search charity registers for organisations that align with your cause.
If you collect donations without having a recipient in mind, there is a risk the charity might not be able to accept the funds – particularly if the use of funds does not match their charitable objectives. To avoid difficulties, always check the charity is able and willing to accept and use the funds as intended.
When supporting a charity in your own capacity, be clear you are acting “in aid of” the charity, rather than “on behalf of” it, so that donors and the charity understand your relationship.
2. Be Transparent with Donors
Clarity is crucial. Always explain exactly what you are raising money for – both in person and online. Your communications should include:
- The name and registration number (if available) of your chosen charity
- Whether donations support the charity’s general work or a specific project (check with the charity if it will accept donations restricted to a particular use)
- Your fundraising target, if you have one
- A time frame for your fundraising
- How donations will be divided if raising for more than one charity
- What will happen if you cannot complete a sponsored challenge or if the fundraising goal isn’t reached
If you deduct expenses (like travel or materials), state this up front. Always ensure a way for potential donors to ask questions – and respond honestly.
3. Understand Online Fundraising Platforms
Most major online fundraising sites require you to state the purpose of your appeal before launching. Carefully read their terms and conditions to avoid unexpected fees or obligations. Ensure donors are informed about any fees or optional tips deducted by the platform.
4. Handle Donations Properly
To maintain trust, donations should be transferred to your chosen charity swiftly and securely. Use established fundraising platforms or direct payment channels wherever possible. Avoid using a personal bank account, as this can cause suspicion and may have tax consequences. If you must use your own account, keep thorough records and ensure transparency at every step.
5. Expenses and Deductions
You may deduct reasonable expenses from what you raise, but you must tell donors in advance and keep deductions fair. Failure to declare expenses may be deemed fraudulent and illegal.
6. Plan for Unforeseen Outcomes
Consider what will happen if you cannot fulfil the fundraising purpose – for example, if too little or too much is raised or the specific need changes. Tell donors up front about a secondary purpose (‘for example if the new equipment cannot be purchased, donations will go towards general running costs at the hospice’). If no secondary purpose is set, the law may require you to seek donor consent for any changes to the spending of funds.
7. Sponsored Challenges: What If Plans Change?
If collecting donations in exchange for completing a challenge (like a marathon), state plainly whether donations will still go to the charity if you do not finish. If this is not stated and you cannot complete the challenge, you must return contributions.
8. Collecting Goods Versus Monetary Donations
While some appeals request donated goods (like food or clothing), in emergencies it is usually more effective to donate money. Sending unrequested goods can drain resources and sometimes even hamper relief efforts.
Personal Cause Fundraising
If you are raising funds for an individual (for example, to support a relative in need), this is a “personal cause” and not charity fundraising. Even so, you should still be transparent and honest. Never suggest that your appeal is a charity collection if it is not – this would be fraudulent and could result in criminal charges.
The Fundraising Regulator regulates charitable fundraising across England, Wales and Northern Ireland. Where you are authorised by a charity to fundraise “on behalf of” it, your activities are directly regulated and you must comply with the Code of Fundraising Practice.
If you are fundraising independently “in aid of” a charity, you are not subject to direct regulation. However, you are still encouraged to follow the standards set out in the Code to protect both your own reputation and that of the charity you are supporting.
You can read the full guidance here.
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Disclaimer
This information is intended for general informational purposes only and does not constitute legal advice. We recommend seeking professional advice before taking any action on the information provided. If you would like to discuss your specific circumstances, please feel free to contact us on 0800 2800 421.
