Trustee payment

The rule: voluntary by default, paid only with authority

A charity trustee in England and Wales can be paid only with legal authority, where the payment is in the charity’s best interests and the conflict of interest is managed. The Charity Commission’s series Charities paying a trustee or a connected person: understand the rules (CC11), published on 25 April 2025, starts from the principle: “Being a trustee is generally a voluntary role. This is what makes the charity sector unique and promotes trust and confidence in charities.” The series replaced the old single CC11 document, and the Commission’s announcement of the new guidance says “The underlying rules on trustee payments have not changed.”

Getting it wrong has a cost. The Commission warns that a payment made without using a power correctly “may be ‘unauthorised’. As a result, your charity will face risks, and those who received the payment, or all the trustees, may have to repay the charity.”

“Payment” is wider than a salary or an invoice. The Commission’s guidance on paying for goods or services includes “giving other benefits, such as free use of equipment or property or free access to services that people normally have to pay for”, and says the rules also apply “if it is a company belonging to the charity that pays the trustee” and “if it is a person or organisation connected to the trustee who is being paid”. Section 188 of the Charities Act 2011 defines connected persons: “a child, parent, grandchild, grandparent, brother or sister of the trustee”, a spouse or civil partner of the trustee or of those relatives, a business partner, and institutions and companies they control or have a substantial interest in.

Expenses are different. The CC11 series says “Paying expenses to trustees is not a trustee payment or benefit”, and the Commission’s Trustee expenses: what charities can pay adds “You do not need Charity Commission approval to pay trustee expenses.” A charity’s expenses policy should include “that a trustee cannot approve their own claim”; our volunteer expenses guide covers the mechanics.

The kinds of trustee payment, and the authority each needs

The CC11 series treats each kind of payment separately, because each needs a different authority:

• Goods or services to the charity, such as professional services from a trustee who is a solicitor or accountant, or a trustee’s firm providing goods or doing a repair. The statutory power in section 185 can authorise this, as can a power in the governing document. No trustee or connected person can be paid for auditing the charity.
• Employment. Section 185 “does not apply to any remuneration for services provided by a person in the person’s capacity as a charity trustee or trustee for a charity or under a contract of employment.” The Commission’s guidance on employing a trustee or connected person says “If your power only mentions sections 185-188 of the Charities Act 2011 … you cannot use it to employ a trustee.” A clear governing-document power or Commission authority is needed.
• Carrying out trustee duties. The Commission’s guidance on paying a trustee for carrying out trustee duties says “This should only be considered in exceptional circumstances and for a temporary period of time when paying a trustee clearly brings a significant advantage to the charity over other options”, and “Governing documents do not tend to contain a power for this type of payment.” Without a clear power, the Commission must authorise it.
• Loss of earnings. The Commission’s guidance on compensating a trustee for loss of earnings says “You must have a power or authority (legal permission) to compensate a trustee for lost earnings. So, check your charity’s governing document.” It suggests asking employed trustees whether their employer offers paid volunteering leave first, and says the amount should be the lower of the earnings actually lost and a reasonable sum for what the trustee was asked to do.
• Other payments, including honorariums, thank-you gifts and payment for work already done, covered below.

In each case the payment must still be in the charity’s best interests and the conflict managed: a power to pay is permission, not a reason.

Paying a trustee for goods or services: the six conditions

Section 185 of the Charities Act 2011 lets a charity pay a trustee or connected person for goods, services or both, without a governing-document power, if its conditions are met; goods were added by the Charities Act 2022 from 31 October 2022. The Commission says “You must meet all 6 conditions”:

1. No prohibition. The governing document does not expressly prohibit the payment (Condition D).
2. Best interests. Before the agreement, the other trustees decide they are satisfied that it “would be in the best interests of the charity” for the goods or services to be provided by that person for that amount (Condition B).
3. A reasonable amount. The amount or maximum amount “does not exceed what is reasonable in the circumstances” (Condition A).
4. A written agreement setting out the amount or maximum amount (Condition A).
5. A minority. Only a minority of the trustees are paid or benefit, counting trustees paid in any other way and those connected to them (Condition C). The Commission adds: “Don’t include trustees receiving expenses as this is not a ‘trustee payment’.”
6. The conflicted trustee takes no part. Section 186 says that trustee “is disqualified from acting as such in relation to any decision or other matter connected with the agreement.” The Commission says “a conflicted trustee must leave the meeting when you discuss and make your decision” and “you must not count a conflicted trustee in the quorum”. They may give information to help the others before they leave.

The written agreement is separate from the minutes. The Commission is explicit: “Before you receive the goods or service, you must enter into a written agreement with the trustee or connected person. Recording the decision in your minutes of the meeting is not enough. There must be a separate agreement.” It must describe the goods or service, name the provider and state the amount or maximum; it should confirm the conditions are met, say how the charity will check that what it receives meets what was agreed, and state whether the charity may end the arrangement early. The provider should sign it, and it “must be signed by one of the other trustees or a person authorised by the other trustees”.

Test the price. “You should get quotations from other suppliers unless the amount involved is very small. You do not have to start a formal tendering exercise but if your charity has a policy on buying goods and services, you should follow it.”

Two things the power cannot do. “You cannot pay a trustee or connected person for providing auditing services to the charity”, because the auditor must be independent. And “You cannot use the statutory power to pay a trustee or connected person to provide goods or services to a charity’s subsidiary.”

If a disqualified trustee does take part, section 186 lets the Commission order them to repay all or part of the payment, or direct that it is not paid. In a CIO, regulation 36 of the CIO General Regulations 2012 separately says a trustee who would benefit from a transaction “must not take part in the making of any decision” and “must not be counted in the quorum”. Our conflict of interest guide covers how to run that part of the meeting.

Honorariums, work already done, and when the Commission must agree

Small payments and honorariums. The Commission’s guidance on other types of trustee payments says “You do not usually need authority from the Charity Commission if your payment is ‘small’”: “for non company charities, an individual payment of £1000 or less” or “for company charities, an individual payment of £200 or less”, and “where total payments to all trustees at the charity - company or non company - during the financial year will not exceed £1000. (This does not include trustee expenses)”. The trustees must still be satisfied the payment is in the charity’s best interests. A charitable company paying a retiring trustee more than £200 needs the Commission’s prior written consent under section 201 of the Charities Act 2011 and then its members’ approval.

Work already done. Since 7 March 2024, section 186A lets the Commission order a charity to pay a trustee for work already carried out, or authorise them to keep a payment or benefit already received, where “the Commission considers that it would be inequitable for the person not to be paid the remuneration or not to retain the benefit.” The Commission treats this as exceptional, usually only where there was no other authority.

Governing-document powers. The statutory power sits alongside any power in the governing document. The Commission says a governing-document power that only refers to sections 185 and 186 is the statutory power, so its conditions apply, and that a power requiring Commission consent needs no consent if the statutory conditions are met. If the governing document prohibits the payment, section 185 cannot be used, and the board will need to change the document where it can or ask the Commission. Where a charitable company agrees to pay a trustee for carrying out trustee duties for at least 2 years, the Commission says section 201 authority is needed first.

Records, disclosure in the accounts, and the register

The Commission’s guidance on goods or services says: “Keep a full record of your decisions and the reasons for them. For example, in the minutes of the relevant meeting. This can help show you followed the rules.” The minute should show the conflict of interest declared, the trustee leaving, the quorum without them, the quotations compared and the reasons. “The agreement forms part of your charity’s financial records. You must keep it for 6 years.” Keep any Commission consent or authority with it.

The payment also appears in the accounts. For charities preparing accruals accounts under the Charities SORP (FRS 102) 2026, for reporting periods beginning on or after 1 January 2026, the notes must state whether any trustee was paid remuneration or received other benefits from an employment with the charity or a related entity and, for each such trustee, “the legal authority under which the payment was made”, their name and role, the reason and the amount. The notes must also say that no trustee expenses were incurred or give the total, the nature and the number of trustees reimbursed. A payment to a trustee or connected person for goods or services is also a related party transaction, which the SORP treats as material whatever its size and requires to be disclosed with the related party’s name, the relationship, a description of the transaction and the amount. Charities preparing receipts and payments accounts are not bound by the SORP, but the Commission says “You should include details of payments you made to trustees and connected persons. For example, who you paid, why you paid them, what you paid them, and the power or authority for the payment.”

A payment arrangement is also an interest to record. Note it in the register of interests, review it when the agreement ends or is renewed, and recheck the minority test before any new agreement.

The conversation the conflicted trustee was part of

The rules assume the decision is made at a meeting the conflicted trustee has left. In practice payments to trustees are usually talked through first in the board’s group chat. The chair posts that the hall roof needs work; a trustee replies that her husband’s firm could quote; two others agree; the treasurer asks about other quotes. By the time the meeting takes the formal decision, with the trustee outside the door, the discussion the Commission says she must not take part in has already happened, with her in it.

That conversation is part of how the decision was made, and the record the trustees would need if the payment were questioned. On personal phones the charity cannot produce it, and the minute shows only the tidy version.

ComplyChat gives a board its own channels, with everyone told the conversation is on the record from the first message, so a board can discuss an arrangement in a channel the conflicted trustee is not in. On paid plans, once the charity’s Microsoft 365 tenant is connected, the lasting record files there under the charity’s own retention rules. It is not a payments or accounts system, and it does not decide whether a payment is authorised: that remains the trustees’ judgement under the law and the CC11 guidance.

A question for the next board meeting: for each payment to a trustee or connected person in the last six years, could we show the agreement, the minute and every conversation the conflicted trustee took part in?

Questions people ask

What is the policy for charitable trustees regarding expenses?

Charity trustees can be repaid the reasonable costs they incur in the role, such as travel to meetings, and the Charity Commission says paying expenses is not a trustee payment or benefit and needs no Commission approval. The Commission says a charity should have a policy setting out what trustees can claim, the evidence needed, how claims are approved, and that a trustee cannot approve their own claim.

What is a trustee paid?

Most charity trustees are paid nothing: the Charity Commission says being a trustee is generally a voluntary role. A charity can pay a trustee only where it is in the charity’s best interests and there is legal authority – the statutory power in section 185 of the Charities Act 2011 for goods or services, a clear power in the governing document, or Commission authority.

Can a charity trustee be paid for providing services?

Yes, in England and Wales section 185 of the Charities Act 2011 lets a charity pay a trustee or connected person for goods or services if the statutory conditions are met: a written agreement stating the amount or maximum amount, which is reasonable; a prior decision by the other trustees that it is in the charity’s best interests; only a minority of trustees paid; and no prohibition in the governing document. Under section 186 the trustee who would be paid is disqualified from the decision, so the Commission says they must leave the meeting and not count in the quorum.

Can a charity pay a trustee for loss of earnings?

Only if it is in the charity’s best interests, the conflict is managed and there is a clear power in the governing document or Charity Commission authority; the Commission notes governing documents do not tend to contain such a power. It says the amount should be the lower of the earnings actually lost and a reasonable amount for what the trustee was asked to do.

Can a charity give a retiring trustee a thank-you payment?

Usually yes, without Commission authority, if it is in the charity’s best interests and small: an individual payment of £1,000 or less for a non-company charity or £200 or less for a charitable company, with total payments to all trustees in the financial year not exceeding £1,000, excluding expenses. A charitable company paying a retiring trustee more than £200 needs section 201 authority and members’ approval.

What are trustees not allowed to do?

On payment, a charity trustee cannot be paid for being a trustee, employed, or paid for goods or services without legal authority, cannot take part in decisions about their own payment, and cannot be paid for auditing the charity, according to the Charity Commission’s CC11 series and sections 185 and 186 of the Charities Act 2011. The wider duties are in our charity trustee responsibilities guide.

Official guidance and your next step

The Charity Commission’s guidance is the CC11 series on paying a trustee or a connected person, with Trustee expenses: what charities can pay. The law is in sections 185, 186, 186A and 188 of the Charities Act 2011, and the disclosure rules in module 9 of the Charities SORP 2026. Quotations are from those pages as published on 8 October 2026.

This guide is a summary for charities in England and Wales, not legal advice. In Scotland, section 67 of the Charities and Trustee Investment (Scotland) Act 2005 sets a different rule and OSCR publishes its own guidance; Northern Irish charities should read the Charity Commission for Northern Ireland’s. A charitable company considering section 201 authority should take advice.

Then do one thing: list every payment or benefit the charity gave a trustee, or anyone connected to one, in the last financial year, and write the authority for each beside it. Any line without one is the first item for the next meeting.