Scottish charity audit threshold increased to £1m

The Charities Accounts (Scotland) Amendment Regulations 2025 have now been published. Plans for an increase to the audit exemption threshold for Scottish Charities were announced earlier this year. These Regulations bring the plans into legislation.

The key provisions are:

• The audit exemption threshold has been increased from £500,000 to £1,000,000
• The threshold for exemption from the requirement to prepare consolidated accounts has also been increased from £500,000 to £1,000,000
• The regulations come into effect for accounting periods commencing on or after 1 January 2026

The commencement date of 1 January 2026 coincides with the date on which the new charity Statement of Recommended Practice (SORP) comes into effect. These changes will typically apply for accounting periods ending 31 December 2026 and 31 March 2027.

There has been no change to the asset threshold, which remains at £3.26m. Charities with total gross assets in excess of this amount will not qualify for exemption from audit, irrespective of their income.

As before, exemption from the preparation of audited accounts will not apply if an audit is required by the charity’s constitution, by funding agreements or by some other specific requirement.

These increased thresholds offer a welcome opportunity for eligible charities to reduce the burden and costs of compliance.

The Regulations are here:  The Charities Accounts (Scotland) Amendment Regulations 2025

The latest Charity SORP is available here: Home – SORP