Unrestricted fund
Money the trustees or committee can spend on anything within the organisation’s purposes.
An unrestricted fund is money a charity, club or community group can spend at its trustees’ or committee’s discretion on anything within the organisation’s purposes. Subscriptions, general donations, bar takings and most fundraising income are unrestricted unless a donor or an appeal tied them to something. It is often called the general fund.
Money the trustees have earmarked for a project — a designated fund — is still unrestricted, because the earmark is theirs to undo. What a charity can genuinely call its reserves comes from its unrestricted funds, after leaving out designated funds set aside for essential future spending.
Worked example
A PTA ends the year with £3,800 in the bank: £200 a parent gave “for the library”, which is restricted, and £3,600 from the summer fair and the discos, which is unrestricted. The committee can spend the £3,600 on anything within the PTA’s purposes; the £200 goes on library books.
Common mistake
Calling money restricted because the committee has plans for it. A plan, even a minuted one, makes money designated at most; only the donor or the terms it was raised under make it restricted.
Grounded in Charity Commission — Charity reserves: building resilience (CC19) guidance. Figures last checked . General information, not tax advice.
Related terms
Restricted fund
Money given for a stated purpose, to be spent only on that purpose.
Designated fund
Unrestricted money the trustees have earmarked — and can release again.
Receipts and payments account
A small charity’s or club’s cash-based accounts: money in, money out, and the balance.
Independent examination
The lighter check of a smaller charity’s accounts, instead of an audit.
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Questions about this term
Unrestricted fund: common questions
- Is the general fund the same as an unrestricted fund?
- Usually, yes. The general fund is the everyday name for the unrestricted money that has not been designated for anything, and many organisations show designated funds beside it as separate unrestricted funds. Together they make up the unrestricted funds in the accounts.
- Is money from a fundraising event unrestricted?
- When the event did not promise a purpose, yes. A fair or quiz night raising money for the organisation in general raises unrestricted money. One advertised as raising money for a named thing — a new roof, a minibus — raises restricted money for that thing.
- What can unrestricted funds be spent on?
- Anything within the organisation’s purposes, as its governing document sets them out, at the trustees’ or committee’s discretion: running costs, projects, reserves for a rainy day. They cannot be spent outside the purposes, and charity trustees still have to act in the charity’s interests.
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