When you become a trustee, you volunteer your services and usually won’t receive payment for your work. Generally, charities can’t pay their trustees for simply being a trustee. Some charities do pay their trustees, however, they can only do so because it is allowed by their governing document, by the Charity Commission or by the courts.
Pay a trustee to do work for the charity
Trustees could be paid for:
- Building work such as plumbing or painting
- Providing specialist services, such as estate agency or computer consultancy
- Offering premises or facilities for occasional use, for example as a meeting room
- Administration or secretarial work
Before paying a trustee, you must have regard to the commission’s guidance on paying trustees for services. It explains how you must:
- Produce a written agreement between the charity and the trustee (or connected person) being paid.
- Specify the exact or maximum amount to be paid
- Make sure the trustee does not take part in decisions made by the trustee board regarding any aspect of the agreement
- Agree the payment is in your charity’s best interests and reasonable for the service provided
- Not allow payments or other benefits to half or more than half of your board – the number of trustees receiving any payment or benefit must be in the minority
- Make sure your charity’s governing document doesn’t prevent you from paying trustees for services
Trustee expenses
Expenses are for out-of-pocket payments trustees have to make in order to carry out their duties, for example:
- Travel to and from trustee meetings
- Overnight accommodation
- Postage, telephone calls and broadband time for charity work
- Childcare or care of other dependents while attending meetings
Your charity should have a written agreement setting out what is classed as an expense, plus how to claim and approve expenses.
Pay someone who is connected to the charity
If someone is connected to a trustee, they are known as a ‘connected person’. For example:
- A spouse or partner
- Siblings
- A brother or sister-in-law
- Parents
- Business partner
If a connected person is to be paid or employed by the charity, the trustee or trustees they are connected to must not be involved in any part of the process.
View more information on the charity accountancy services we offer, or if you would like to know more about this subject please call 01482 427360.
