30/07/2026
If your charity prepares accounts on an accrual basis, there’s an important update you need to know about. SORP 2026, the latest edition of the Charities Statement of Recommended Practice, is now in effect for accounting periods starting on or after 1 January 2026.
What is the Charities SORP?
The Charities SORP sets out how charities in the UK should prepare and present their financial accounts. It’s the standard reference point for trustees, finance leads, and anyone responsible for financial reporting in a voluntary or community organisation.
If you’ve heard the term but never been quite sure what it means in practice – you’re not alone. The SORP can feel technical, but at its core it’s there to make sure charity finances are reported clearly, consistently, and in a way that builds public trust.
What’s changed in SORP 2026?
Two areas in particular are worth flagging for VCS organisations:
Lease accounting Under the previous rules, many organisations could simply record a lease as an ongoing expense. The new SORP requires most operating leases to be recorded on the balance sheet, meaning both assets and liabilities will increase for any organisation that leases property or equipment. This could affect your financial position and, in some cases, whether you need a formal audit.
How income from contracts is recognised SORP 2026 introduces a new five-step model for recognising income from exchange contracts, in other words, where your organisation provides goods or services in return for payment. If your organisation earns income this way, you’ll need to review how and when that income is recorded in your accounts.
What should you do now?
If your accounting period starts on or after 1 January 2026, SORP 2026 already applies to you. Here are some practical first steps:
Check which accounting period you’re in and confirm whether SORP 2026 applies
Review any lease arrangements your organisation holds
Look at how your organisation currently records income from contracts
Speak to your auditor, independent examiner, or financial adviser if you’re unsure
Use the helpsheets and guidance available at charitysorp.org
If your accounting period started before 1 January 2026, SORP 2019 still applies for now — but it’s worth getting familiar with the changes ahead of your next period.
Support on the E-Portal
Financial record keeping and reporting is coming soon to the E-Portal as part of our growing resource bank for VCS organisations in Essex. In the meantime, you can find the full SORP 2026 guidance, helpsheets, and example trustee annual reports at charitysorp.org.
