What is the difference between receipts and payments and income and expenditure?

Receipts and payments counts money when it is received or paid; an income and expenditure account counts income when it is earned and costs when they are incurred, including amounts still owed at the year end. Accruals accounts for charities are prepared on the income and expenditure basis.

Does a receipts and payments account show each fund separately?

For a charity it should: restricted money is kept apart from unrestricted money, and the Charity Commission’s own template lays the account out by kind of fund. Each fund then has its own opening balance, receipts, payments and closing balance, adding up to the bank.

Can a charity that has grown past the limit keep using receipts and payments?

Not for a year in which its gross income is over the limit — £500,000 in England and Wales for years ending on or after 30 September 2026. From that year it prepares accruals accounts following the Charities SORP, usually with an accountant’s help.

Clubs & charities · UK

Receipts and payments account

A small charity’s or club’s cash-based accounts: money in, money out, and the balance.

A receipts and payments account is the simplest form of accounts: the money received and paid out during the year, grouped under headings and split by fund, with the opening and closing balance, plus a statement of assets and liabilities at the year end. There are no accruals — money counts when it moves.

In England and Wales, a charity that is not a company may prepare receipts and payments accounts while its gross income is £250,000 or less for financial years ending before 30 September 2026, and £500,000 or less for years ending on or after it. A charitable company prepares accruals accounts at any size. OSCR in Scotland allows receipts and payments under £250,000, and the Charity Commission for Northern Ireland at £250,000 or less.

Worked example

A club starts the year with £3,640, receives £10,380 (subs, match fees, bar takings and a £4,000 grant) and pays out £8,560. Its receipts and payments account shows each heading, the totals and a closing balance of £3,640 + £10,380 − £8,560 = £5,460 — the bank balance on the last day.

Common mistake

Leaving out the statement of assets and liabilities. The cash summary is only half of the account; what the organisation is owed, what it owes and what it owns at the year end go alongside it.

Try the receipts & payments →See it in 2Fin: Funds — receipts and payments by fund →

Grounded in Charity Commission — Threshold changes at a glance guidance. Figures last checked 11 October 2026. General information, not tax advice.

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