What's in store for the charity sector in 2026?

Long awaited provisions of the Charities Act 2022, easing the rules on making ‘moral payments’ were finally implemented on 7 November 2025. Read our blog here. The Charity Commission published new guidance at the same time. The ex-gratia provisions were the final provisions of the Charities Act 2022 to come into effect. 

Three sets of guidance/codes have been published this year:

1. New Code of Fundraising Practice (from 1 November 2025)
2. New Code of Charity Governance (3 November 2025)
3. New Charity Investment Governance Principles (launched 16 January 2025)

We have explained what you need to know about these codes (along with updated Charity Commission guidance published in the year on matters such as trustee payments and decision making) in our blog here. 

The Supreme Court ruling in the case of For Women Scotland, in April of 2025, will have consequences for charities providing services or membership on a single sex basis. This is brilliantly discussed by our employment colleagues here.

All charities should be aware of changes made in the new charities SORP, neatly summarised in our blog here. 

For incorporated charities (for example companies limited by guarantee), wide ranging changes have been introduced and continue to be implemented by the Economic Crime and Corporate Transparency Act 2023 (referred to as ECCTA) – our website has lots of coverage, but a good place to start is here. 

A draft Code of Practice for Services, Public Functions and Associations is currently before the Minister for Women and Equalities for approval. The impact of the For Women Scotland case is already leading charities to make very difficult decisions, explored in greater depth here. 

New rules aiming to reduce the risk of terrorist attacks in public spaces will be introduced by April 2027. Read here for more information. 

Changes introduced by the Data (Use and Access) Act 2025 (DUAA) slightly eases marketing rules for charities. The Fundraising Regulator has published its response to the consultation on the new rules. They call it “a welcome opportunity for individual charities to strengthen engagement with their supporters” but “charity trustees, their staff and fundraisers will need to exercise caution and maintain vigilance when using soft opt-in”. 

Huge changes for employers are being introduced over the next couple of years under the Employment Rights Act 2025, which gained Royal Assent on 18 December 2025. Read more here. 

Our Employment Rights Act 2025 hub brings together all our latest insights, analysis and updates on the Employment Rights Act as it moves into the implementation phase. 

For charities operating in this sensitive area, the question is when (and whether) they will need to get to grips with the ‘Terminally Ill Adults (End of Life) Bill’. The Bill will allow adults who are terminally ill, subject to safeguards and protections, to request and be provided with assistance to end their own life. Currently enmired in the House of Lords Committees, our team have explained what you need to know here. 

The Charity Digital Skills report shows that 76% of charities are using AI but many of them lack the skills to make the most of AI.

New guidance to support charities using AI in fundraising and an associated blog were issued by the Fundraising Regulator on 8 December 2025.

Mills & Reeve has a wide range of experts and resources on the hot topic of AI, including:

• The critical AI window – A report to help leaders navigate compliance, protect their organisations and unlock AI’s full potential safely and confidently.
• FutureProof – A series looking at the impact of AI on the world of professional indemnity insurance.

Charity trustee whistleblowing protection rights are developing through a series of tribunal cases – we are expecting a ruling on the case of MacLennan v The British Psychological Society soon. Read more in our blog here. 

Changes to financial thresholds on 1 October 2026 – the thresholds for independent examination of accounts and audit requirements are increasing. Explore more in our blog here.