Basic Tax Advice for Non-Profit Organisations

Charities and non-profit organisations are often considered to be the same thing, yet this perception is not strictly true.

Whilst charities are technically non-profit organisations, not all non-profit organisations are charities. For instance, registered community sport clubs are not charities, however they are a group of people trying to make a social – not profitable – difference to the community.

Yes, they are allowed to generate some surplus revenue; however this money must be retained within the organisation and used for its self preservation, expansion or plans. And this unfortunately is where things begin to get complicated.

As a non-profit organisation you are subject to a long list of regulations and laws, including SORP, Companies Act, Charities Act, Gift Aid, VAT and PAYE compliance. And this is forgetting your need to raise finance for your organisation!

So what are you to do?

The idea of getting a chartered accountant to manage your finances may seem strange when your goal is not to make a profit; however there is more to having an accountant than getting your taxes done.

Most top accountants can supply you with the following services, enabling you to focus on what you are best at: your organisation.

* Audit – even as a non-profit organisation, you will be subject to an audit. Pick a quality accountant and they can efficiently perform an audit whilst advising you of ways to improve your operations.
* Gift Aid – a clever tax accountant will be able to review your internal procedures to ensure you are eligible for this aid, as well as maximise your Gift Aid recoveries.
* IT support – most top accountants will supply you with the right accounting software so you are in the position to track your in-goings and out-goings more efficiently.
* Accountancy services and advice – from the preparation of your accounts to budgets, forecasts and cash flows, an accountant can help your organisation to prosper.
* Specialist VAT advice – VAT can get complicated as a non-profit organisation. An accountant can offer you clarification of these rules as well as guide you through how certain transactions will affect your VAT compliance and planning.
* Law and regulations – remember the regulations we listed above i.e. SORP? Accountants can ensure your organisation complies with these regulations on top of making the most of them.
* Funding – there will be time when your organisation requires funding, such as to replace equipment or fund an event. In these instances, an accountant can help you to find sources for finance and ensure you get the best deal.

Just because you’re non-profit, doesn’t mean you have to go it alone when dealing with your finances. So why not consider employing a chartered accountant? With their support and advice, you can feel confident that your organisation will continue to prosper for many years to come.

Everyone needs help with accounting from time to time, if you find yourself getting lost with the all the processes why not contact Barnes Roffe for a free appraisal. Barnes Roffe are a chartered accountantswith experience at dealing with charities accounts.