Charities SORP 2026: What Changes and When It Applies to Your Accounts

The Charities SORP (FRS 102) has been updated and applies to accounting periods starting on or after 1 January 2026. If your charity prepares accruals accounts, this transition is either already underway or approaching fast depending on your year-end date. This guide explains what has changed at a framework level, how to map the transition to your specific year-end, and what trustees and treasurers need to do in practical terms before and after the switch.

The short answer: when SORP 2026 applies to you

SORP 2026 applies to any accounting period that starts on or after 1 January 2026. If your financial year begins on 1 January 2026 or any date after that, your next set of accruals accounts must follow SORP 2026. If your financial year began before 1 January 2026, you continue under the previous SORP for that period and transition with the following year. The effective date is the start of the accounting period, not the date you file or the date accounts are signed.

Source: charitysorp.org (verified 2026-07-11: "The Charities SORP and SORP 2026 will apply to accounting periods starting on or after 1 January 2026").

Who must follow the Charities SORP at all

Only charities that prepare accruals accounts must follow the Charities SORP. Whether your charity prepares accruals accounts or simpler receipts and payments accounts depends on two factors: your legal structure and your income level.

The rule under CC15d and CC31 is as follows:

• Receipts and payments accounts are available to non-company charities whose gross income is £250,000 or less (£500,000 or less for financial years ending on or after 30 September 2026). If your charity is an unincorporated association or a trust and your income does not exceed that threshold, you may choose receipts and payments rather than accruals. Receipts and payments accounts do not need to follow the SORP, so the SORP 2026 transition does not apply to you.
• Accruals accounts are compulsory for all charitable companies (regardless of income) and for any non-company charity whose gross income exceeds £250,000 (£500,000 for financial years ending on or after 30 September 2026). If you prepare accruals accounts, SORP 2026 applies to periods starting on or after 1 January 2026.

If you are unsure whether your charity qualifies for receipts and payments, check CC15d. If your income is close to the £250,000 threshold, note that the test is applied to gross income in the year, so a one-off uplift (for example, a capital grant) can push you into the accruals requirement even if it does not recur.

You can also read our guide to audit versus independent examination for how external scrutiny requirements overlay on top of the accounts-format decision.

What SORP 2026 changes

SORP 2026 is an updated version of the Charities SORP (FRS 102), updated to align with the revised FRS 102 financial reporting standard that itself applies from the same date. The changes affect how certain items are recognised, measured and disclosed in accruals accounts.

The key areas of change at a framework level (verified via charitysorp.org) include:

• Lease accounting: the revised FRS 102 brings in a new model for lessee accounting that requires most leases to be recognised on the balance sheet, replacing the old operating/finance lease split for lessees. For many charities this means bringing property leases onto the balance sheet for the first time.
• Revenue recognition: a revised five-step model for revenue recognition aligns UK practice more closely with international standards, affecting how grant income and exchange transactions are recognised over time.
• Financial instruments: simplified financial instruments disclosures have been updated; charities with loan arrangements or investment portfolios should check the new measurement and disclosure requirements.
• Disclosures: the notes to the accounts have been updated across several areas, including related-party transactions and trustee remuneration disclosures.

This page does not attempt to reproduce the full text of SORP 2026. Trustees and finance leads should read the official documentation at charitysorp.org for the complete updated requirements. This guide focuses on the transition question that most charities face right now: when does it apply and what do you need to do before your first affected year-end.

Note: further detail on what has changed in each area is covered in our blog post SORP 2026: what changed and what it means for your charity.

Transition timeline by year-end date

The table below maps common charity year-end dates to the first accounting period that falls under SORP 2026 and the approximate filing deadline for that period. The transition point is always the first accounting period whose start date is on or after 1 January 2026.

If your charity has a 31 March year-end, your 2024/25 accounts (1 April 2025 to 31 March 2026) are prepared under the previous SORP. Your 2025/26 accounts (1 April 2026 to 31 March 2027) are your first SORP 2026 accounts. You have until January 2028 to file them, but the transition work needs to happen well before the year-end, not after.

If your charity has a 31 December year-end, your 2025 accounts (1 January 2025 to 31 December 2025) are your last set under the previous SORP. Your 2026 accounts are your first under SORP 2026. This group is furthest into the transition and should already have the new policies in place.

What to do this year and next year

A SORP transition is not a filing event, it is an accounting policy change. The work happens before and during the period, not when the accounts are drafted. The checklist below is structured around three stages.

Stage 1: before your first SORP 2026 period starts

• Read the updated SORP at charitysorp.org and identify which modules apply to your charity's activities and structure.
• Review your current accounting policies against the updated requirements, particularly lease accounting, revenue recognition and any financial instruments your charity holds.
• If your charity holds property leases, obtain details of all lease terms, rental values and break clauses. These will be needed to calculate the right-of-use asset and lease liability under the revised standard.
• Brief your auditor or independent examiner early. They will want to agree the transition approach and opening balance adjustments before the period ends, not when the draft accounts arrive.
• Update your accounting software or chart of accounts if needed. Right-of-use assets and lease liabilities are new balance-sheet line items for many charities.

Stage 2: during your first SORP 2026 period

• Apply the new accounting policies consistently throughout the period from the first day.
• Keep a record of transition adjustments: comparative figures in your accounts will need to be restated or supplemented with disclosure of the transition method used.
• Check grant agreements and major income contracts against the revised revenue recognition criteria. Some performance-related grants may be recognised differently.

Stage 3: when preparing the first SORP 2026 accounts

• Include the required transition disclosures, explaining the accounting policies adopted and the effect of any changes from the previous SORP.
• Confirm that your trustees annual report has been updated to reflect the new reporting requirements (see the next section).
• Submit to your independent examiner or auditor with enough lead time to address queries before the filing deadline.

How the trustees annual report is affected

The trustees annual report (TAR) is not a separate document from the accounts filing: it is submitted alongside the accounts to the Charity Commission and is a required part of the annual return for charities with income over £25,000. SORP 2026 carries updated guidance on what the TAR should contain.

The substantive content requirements for the TAR (objectives and activities, achievements and performance, financial position and going concern, plans for the future, structure and governance) remain in place. SORP 2026 brings updated framing for how some of these are presented, particularly around risk disclosure and the going-concern assessment following the aligned FRS 102 changes.

Trustees should treat the first SORP 2026 TAR as an opportunity to review whether the report genuinely reflects the charity's governance and strategic position. Common weaknesses that appear on the Charity Commission's published concerns list include: reports that are a copy-paste of the previous year with dates changed; financial review sections that do not explain reserves policy; and risk sections that list generic risks without charity-specific context.

For support preparing your charity's accounts and TAR, see our charity accounts service.

Common transition mistakes

The following mistakes appear repeatedly in the first transition year for any major SORP update. Knowing them in advance is cheaper than fixing them post-sign-off.

Applying SORP 2026 to the wrong period

The most common error is applying the new SORP to an accounting period that started before 1 January 2026. If your period started on, say, 1 October 2025, your accounts for that period are under the previous SORP even if they are being prepared and filed in 2026 or 2027. The start date of the period, not the preparation date, is what matters.

Ignoring lease recognition for small property leases

Some charities assume lease accounting changes only affect large organisations with significant property portfolios. In practice, any operating lease (an office rental, a storage unit, a photocopier agreement) may need to be recognised on the balance sheet under the revised FRS 102 model, depending on its terms. Charities with short-term leases (12 months or less) or low-value underlying assets can use exemptions, but you need to check the criteria rather than assume the exemption applies.

Treating the transition as a filing-time task

Accounting policy changes take effect from the start of the period. You cannot decide mid-year or at year-end what policy to adopt for leases. The opening balance sheet for the first SORP 2026 period needs to reflect the transition entries, which requires the analysis to be done before or at the period start.

Not briefing the examiner or auditor early enough

Independent examiners and auditors will ask about SORP 2026 compliance as part of their work. If they encounter a lease that has not been recognised, or a revenue recognition policy that does not align with SORP 2026, the accounts may need to be revised. Agreeing the approach before the period ends avoids this.

Assuming receipts and payments accounts are affected

The SORP applies only to accruals accounts. If your charity prepares receipts and payments accounts (and is eligible to do so under the income rule for non-company charities: £250,000, rising to £500,000 for financial years ending on or after 30 September 2026), SORP 2026 does not change what you are required to do. Receipts and payments accounts follow the simpler CC16 format.

Getting your first SORP 2026 accounts prepared

For many smaller charities, the SORP 2026 transition is the most significant change to their accounts format in years. The lease accounting changes in particular introduce new balance-sheet entries and disclosures that require professional judgement on classification, measurement and transition method.

Trustees are responsible for ensuring the accounts are prepared correctly and submitted on time. If your charity's accounts are currently prepared in-house using a spreadsheet or basic bookkeeping software, the SORP 2026 transition is a sensible point to review whether that approach still gives you what you need.

Our charity accounts service covers accruals accounts preparation for charities at the SORP 2026 standard, including the transition entries, policy disclosures and trustees annual report. We work alongside your independent examiner or, where required, your auditor.

For details on whether your charity needs an independent examination or a statutory audit, see our guide to audit versus independent examination.

A note on Scotland (OSCR)

This guide covers England and Wales (Charity Commission). Scottish charities are regulated by OSCR (the Office of the Scottish Charity Regulator). The SORP itself (FRS 102) applies across the UK, so the SORP 2026 transition date of accounting periods starting on or after 1 January 2026 applies equally to Scottish charities that prepare accruals accounts.

However, the scrutiny requirements for Scottish charities differ from England and Wales. All Scottish charities are subject to external scrutiny of their accounts regardless of income size, and the thresholds governing the form of that scrutiny differ from the England and Wales figures cited elsewhere on this site. Scottish trustees should check their obligations directly with OSCR rather than relying on the England and Wales thresholds.

Frequently asked questions

When does SORP 2026 apply to my charity?

SORP 2026 applies to accounting periods starting on or after 1 January 2026. Check the start date of your current financial year. If it is on or after 1 January 2026, your accounts for that period must follow SORP 2026. If your period started before 1 January 2026, you continue under the previous SORP for that period and transition with the following year.

Does SORP 2026 apply to receipts and payments accounts?

No. The Charities SORP applies only to accruals accounts. Non-company charities with gross income of £250,000 or less (£500,000 or less for financial years ending on or after 30 September 2026) may prepare receipts and payments accounts and are not required to follow the SORP. If your charity prepares receipts and payments accounts, SORP 2026 does not change your obligations.

Does my December 2025 year-end use the old or new SORP?

Old SORP. Your accounting period 1 January 2025 to 31 December 2025 started before 1 January 2026, so the previous SORP applies. Your next period (1 January 2026 to 31 December 2026) is your first SORP 2026 year. For December year-ends this transition has already begun: the SORP 2026 period started on 1 January 2026.

Can we adopt SORP 2026 early?

Yes. Early adoption is permitted for accounting periods starting before 1 January 2026 where the charity wishes to align with the revised standard ahead of the mandatory date. If you choose early adoption, apply SORP 2026 in full for that period and disclose that you have done so. Check with your independent examiner or auditor before adopting early.

What is the difference between the SORP and FRS 102?

FRS 102 is the UK financial reporting standard that sets out the general accounting rules for non-listed UK entities. The Charities SORP (FRS 102) is the supplementary guidance that applies FRS 102 to the specific context of charities: it adds requirements for fund accounting, the statement of financial activities (SoFA), restricted funds, trustee remuneration disclosures and other charity-specific matters. SORP 2026 is updated to align with the revised FRS 102 that also applies from accounting periods starting on or after 1 January 2026.

Do small charities have to follow the SORP?

Whether the SORP applies depends on your accounts format, not your income alone. If your charity prepares accruals accounts (because you are a charitable company, or because your income exceeds the accruals threshold: £250,000, or £500,000 for financial years ending on or after 30 September 2026), the SORP applies regardless of how small the charity is. If you are a non-company charity below that threshold and you choose to prepare receipts and payments accounts, the SORP does not apply.

What happens if we file accounts under the wrong SORP?

Accounts that do not comply with the applicable SORP are not properly prepared accounts under charity law. The Charity Commission can and does raise concerns about non-compliant accounts during regulatory review. In practice, for smaller charities, the most common consequence is that the independent examiner or auditor flags the non-compliance and the accounts need to be amended before they can sign off. This delays filing and can trigger a late-filing concern. The Commission publishes guidance on its expectations and may note non-compliance in any regulatory contact with the charity.

Does the SORP change the independent examination thresholds?

No. The income thresholds that determine when an independent examination or a statutory audit is required are set by the Charities Act and Commission regulations, not by the SORP. Those thresholds (independent examination required above £25,000 gross income; audit mandatory above £1 million, or above £250,000 with gross assets over £3.26 million) are unchanged by SORP 2026. They do change separately on 30 September 2026: for financial years ending on or after that date the gates rise to £40,000 (examination), £500,000 (qualified examiner and accruals) and £1.5 million (audit, with a £5 million asset trigger). For more detail see our guide to audit versus independent examination.

Where can I see example SORP 2026 accounts?

The official source for example accounts is charitysorp.org, where the SORP Committee publishes illustrative accounts alongside the full standard. These are the definitive examples and should be the first reference for anyone preparing or reviewing SORP 2026 accounts. Large-firm charity teams (UHY, Saffery and others) also publish their own illustrative accounts, which can be useful alongside the official examples. The Charity Commission's published accounts of larger charities on the public register can also show you how organisations in your sector have presented their accounts, though these will largely be under the previous SORP until the first SORP 2026 year-ends are filed.