SORP 2026 for small congregations: what a treasurer must actually do before year-end

The new Charities SORP 2026 applies to accounting periods beginning on or after 1 January 2026, so the first affected year-ends — 31 December 2026 — are weeks away. Our overview of SORP 2026 explains what's changing in principle. This is the practical companion for the person who actually has to do it: the treasurer of a small congregation. The good news is that if you're genuinely small, most of the complexity passes you by. Here's what to check. It is general information, not advice — confirm your own position with your examiner or accountant.

First: which basis and tier are you on?

Two questions settle most of it:

• Receipts-and-payments, or accruals? Non-company charities under £500,000 income can prepare simple receipts-and-payments (cash) accounts — money in, money out. If that's you, most of SORP 2026 does not apply, because the SORP governs accruals accounts. Many small congregations sit here and can breathe easy.
• If you prepare accruals accounts (because you're a charitable company or CIO, or you choose to), then SORP 2026 applies, and you're in Tier 1 if your income is up to £500,000 — the simplest tier, where most faith charities sit.

Knowing which of these you are tells you how much of the rest matters.

The one thing most likely to catch you out: a lease

If you do prepare accruals accounts, this is the change to look at first. Under SORP 2026, most leases now go on the balance sheet — you recognise a "right-of-use" asset and a matching liability rather than simply expensing the rent. For a small congregation that usually means one thing: a leased hall, rooms, or a minibus.

Two points to flag:

• Peppercorn and nominal leases count too. Faith communities often occupy a building or hall for a token rent — £1 a year, or a long lease at a nominal sum. These still need looking at under the new rules, and they're easy to miss.
• Receipts-and-payments preparers are largely spared this. Cash accounting records what you actually paid, so the on-balance-sheet lease treatment doesn't apply in the same way. It's one more reason to be clear which basis you're on.

Income with conditions

Again for accruals preparers: there's a new way of recognising income, and the practical point is that grants or contracts with performance conditions (money you can only keep once you've done something) must be deferred until the conditions are met. Ordinary donations, collections and offerings are largely unaffected — so for most small congregations, this is a small issue, not a big one.

Impact reporting — an opportunity, not a chore

Reporting your impact — the difference you make — is now part of the trustees' annual report for all charities. For a small congregation, don't overthink it: a few honest paragraphs on who you helped and how is both compliant and a lovely thing to be able to show your community and funders.

Your before-year-end checklist

• Confirm your basis and tier — receipts-and-payments, or accruals; and if accruals, Tier 1.
• List any leases — hall, rooms, premises, minibus — including nominal/peppercorn ones, and flag them to your accountant if you prepare accruals accounts.
• Identify any grant or contract income with conditions attached.
• Jot down your year's impact in plain words for the annual report.
• Talk to your independent examiner or accountant early — not in the week before the deadline. (This pairs with the treasurer's year-end checklist and, if your scrutiny level is changing, the audit and examination threshold changes.)

If you're a treasurer feeling daunted, that's normal — and it's exactly the kind of thing we help small faith charities work through.

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This article is general information, not advice. Which rules apply depends on your charity's structure, size and accounting basis. Confirm your position with your examiner or accountant, or talk to us and we'll help you get ready for your year-end.