Revitalising your charity: Advice for dormant, inactive and ineffective charities

The Charity Commission originally launched the ‘Revitalising Trusts’ Programme back in 2018 which was designed to identify and help charities that were deemed to be inactive or ineffective.

The guidance has recently been revised to reflect the fact that the programme will now be expanded and tasked with proactively contacting charities (via the Charity Commission) if they are deemed to be either inactive or ineffective and to ask trustees to consider their future. For these purposes a charity is classified as being:

• ‘inactive’ if they have not submitted the Annual Return for five years or they have reported either no income or expenditure for the last 5 years; or
• ‘ineffective’ if they have spent less than 30% of their income over the last five years based on the data provided to the Charity Commission in their Annual Return filings.

The overarching objective of the programme is to help trustees to ensure their charity’s funds are actually being used to further their objects and are being deployed and applied for the public benefit. If that is not the case or if practical or governance challenges are obstructing the charity’s work, the programme focusses on guiding trustees on addressing those issues and considering their options, which could include:

• the transfer of the charity’s assets to another similar but more active charity (this could include a formal merger or change of structure);
• supporting the trustees in making necessary changes to their governing document and resolving related practical difficulties in accessing charitable assets (such as cash at a bank account that may have been frozen);
• supporting the trustees in changing the charity’s purposes to allow it to work more effectively; or
• closing the charity in question if there are no assets remaining and there are no ongoing activities.

Our dedicated charities team has deep experience in advising charity trustees and can support you whether you wish simply to undertake an initial governance review with a view to revitalising the activities of your charity or whether you have wider concerns that mean the charity needs to more specific advice to explore merging or its closure.

Whatever the challenges, we will be able to advise and guide you through the process. We possess an in-depth understanding of charities and not-for-profit entities which allows our specialist lawyers to provide you with the key strategic advice and operational support that you need.

How we can help

If you would like to have an initial no-obligation discussion about your specific circumstances please do contact Harriet Page or Dominic Ribet (our Charities team) who will be happy to assist with your enquiry and confirm how we can best help your charity. We are also happy to work collaboratively with other professionals (trust accounts or other governance advisors) who may be involved with your charity to provide more discrete support with specific aspects of the administration of your charity where this is needed.