Guidance

Paying a trustee for carrying out trustee duties

Published 25 April 2025

Applies to England and Wales

Being a trustee is generally a voluntary role. This is what makes the charity sector unique and promotes trust and confidence in charities. As a result, external reaction to paying trustees is often negative.

There are legal rules that apply to paying trustees. If you wish to pay a trustee for carrying out trustee duties, read this guidance to understand:

• the rules, including having a power or authority (legal permission)
• the risks, for example public criticism, and the extra risks of this type of trustee payment

You must follow the rules even if the arrangement benefits the charity.

If you do not follow the rules, the trustee who received the payment, or all the trustees, may have to repay the charity.

If you are employing a trustee, that’s different. Read guidance about employment.

You should understand what it means to ‘pay’ a trustee. It means:

• giving financial rewards such as a salary, fees, stipend and/or
• giving other benefits, such as free use of equipment or property or free access to services that people normally have to pay for

The rules also apply if it is a company belonging to the charity that pays the trustee.

You may have to name the trustee you paid and what you paid them in your charity’s accounts. Your charity’s accounts become public information.

This guidance applies to all charities.

Charities can pay trustee expenses: the costs that trustees reasonably incur to perform that role.

Paying expenses to trustees is not a trustee payment or benefit.

Think about whether you should encourage trustees at your charity to claim their expenses to avoid them stepping down for financial reasons.

Read guidance about paying expenses.

What this type of payment means  

 Sometimes, charities consider paying a trustee for carrying out their trustee duties.

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. For example, when a trustee is being asked to complete tasks as part of their trustee role that:

• are more time-consuming
• are more complex
• involve a greater level of responsibility
• require specific skills

and in the context of:

• what the charity does and how it does it, or
• other developments at the charity for example a re-structure, and
• the charity needing the tasks completing in a defined period of time, and
• the trustee being best placed to complete those tasks

Here are some simple examples. They should not be interpreted as indications that the Commission would give authority for a payment. Each application will be considered on its merits.

A charity’s chief executive unexpectedly goes on leave due to a personal crisis. The trustees consider their absence a significant risk to the charity. They decide to temporarily promote a senior employee into the chief executive position for 3 months and for a trustee to provide close support and supervision to this person during that time.

An external review has identified several serious concerns about the charity. As part of its improvement plan, the charity is being restructured which the chair is overseeing, making their role more time consuming. The re-structure is planned to be completed in 12 months.

You must follow steps 1 and 2 to pay a trustee for carrying out trustee duties.

Step 1: Make the decision

The trustees must:

• consider that paying a trustee at the amount agreed is in the charity’s best interests, and
• manage the conflict of interest

Step 2: Have a power or authority (legal permission)

The trustees must have:

• a power in their charity’s governing document that allows the payment, or if they do not,
• authority from the Charity Commission

Make the decision

You, as trustees, must consider that temporarily paying a trustee for carrying out trustee duties is in your charity’s best interests.

This means you can show that having assessed all the options – and risks – paying a trustee brings a clear and significant advantage to the charity over all the other options. You must not make the decision because it benefits the person being paid.

Before making your decision, you should look at other options. For example:

• sharing the trustee’s responsibilities with other trustees
• filling trustee vacancies
• recruiting extra trustees
• employing a new (temporary) employee or engaging a consultant to complete the work identified

If you need Charity Commission authority, you will need to explain your decision including why you cannot recruit unpaid trustees.

Use our decision-making guidance to help you make your decision.

Read guidance about finding new trustees.  

Manage the risks

Paying trustees introduces risks, and this type of payment introduces specific risks.

A specific risk is that the paid trustee may become overly influential. This risk can increase if the paid trustee:

• is the charity’s founder or chair
• is a long-serving trustee
• is connected to other trustees on the board, for example by being family members

This is important because Commission casework has shown that having an overly influential trustee can make it difficult for trustees to comply with their legal duties.

Another specific risk is that you cannot properly assess the paid trustee’s work because of your relationship with them.

Other risks include:

• the charity being seen as a way of benefitting particular individuals
• criticism from within or outside your charity. This could become public criticism and could affect your charity and its funding
• not complying with legal requirements including the rules on conflicts of interest
• trustees disagreeing about whether to pay a trustee

These risks increase if you regularly pay trustees at your charity.

You must manage the risks. For example, by:

• reading this guidance and making sure you follow the rules
• properly managing performance in line with your agreement
• ensuring that payment stops when it should stop
• keeping a full record of why you made your decision to pay
• explaining your decision if it is criticised in public or consulting before looking to pay a trustee for carrying out trustee duties
• following the rules on disclosing payments in your charity’s accounts

The amount of pay must be reasonable 

The amount you decide to pay must be reasonable and in your charity’s best interests.

Think about how you will benchmark and decide what is reasonable. You can:

• get advice from a sector advice body
• look at what similar charities pay for similar activities

Check that your charity can afford to pay.

If you are not making a one-off payment, you should check:

• that how long you are proposing to pay the trustee is in the charity’s best interests
• whether you are creating an employment relationship, with the trustee entitled to employee rights - and tax implications

Get relevant professional advice if you need it. If you are employing a trustee, that’s different. Read guidance about employment.

Have a written agreement

You should have in place an agreement that sets out:

• the reason for the payment
• clear expectations of what the paid trustee will do, including your expectations of quality and timescales – and how you will review this
• a start and end date, if it is not a one-off payment
• the amount you will pay
• whether the arrangement can be ended early
• anything else your charity needs

Get legal advice if you think you need it.

Manage the conflict of interest

When trustees are paid, they have a conflict of interest each time you make decisions about that payment.

In this situation, the following will have a conflict of interest:

• the trustee receiving payment for carrying out trustee duties
• any trustee who has a relationship with the trustee receiving this payment

There can be more than one trustee who is conflicted. Make sure you identify them all.

You must manage the conflict of interest:

• when you make the decision to pay the trustee, and
• when you make any later decisions about it. For example, to continue the arrangement or about the trustee’s performance

Use our guidance to help you.

You must still manage the conflict of interest even if:

• paying the trustee for carrying out trustee duties benefits the charity
• you have a power or authority, as explained in the next section

Check you have a power or authority

You must have a power or authority (legal permission) to pay a trustee for carrying out trustee duties. So, check your charity’s governing document.

Governing documents do not tend to contain a power for this type of payment. However, if your governing document does contain a clear power that permits this, you can use that power.

If the power sets out any rules, you must follow them. For example, it may say you must get the Charity Commission’s consent first. This is called a ‘conditional power’.

You will need authority from the Commission if your governing document:

• does not say anything that clearly permits trustees to be paid for carrying out trustee duties, or
• includes a prohibition

A ‘prohibition’ is any wording or clause that indicates trustees cannot:

• be paid by the charity for carrying out trustee duties, or
• receive any type of payment or benefit (or ‘remuneration’) from the charity

If you are not sure, get legal advice.

If your charity is a company, check if you need extra authority because of company law.

Apply for Charity Commission authority

Read this guidance to understand what the Commission expects when you make a decision about this type of payment.

If you need authority (or consent to use a conditional power), you will need to tell us:

• who you want to pay and the amount
• what you are paying for and why
• what other options you looked at and why you discounted them
• if you tried to recruit extra trustees
• how you decided on the amount, including what benchmarking you did
• why it is in the charity’s best interests to pay a trustee
• how long do you propose to pay the trustee
• the risks you have identified and how you will manage them
• if other trustees at your charity are paid; why they are paid; and how much you pay them. Tell us what proportion of your trustees are currently paid
• that you made the decision in line with your governing document rules. For example, that the meeting was quorate
• how you managed the conflict of interest
• whether your governing document contains a prohibition or a conditional power as explained in this guidance

If you need authority because you cannot manage the conflict of interest, you will need to:

• provide the information listed above about how you made the decision and how it is in the charity’s best interests
• tell us if your governing document includes a power to pay a trustee for carrying out trustee duties
• tell us why you cannot manage the conflict

Make one application if you need authority to pay and to manage a conflict of interest.

Apply for authority

Record your decisions

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.

Keep a record of any Charity Commission consent or authority.

Your written agreement forms part of your charity’s financial records. You must keep it for 6 years.

Disclose trustee payments in your charity’s accounts

Charities that prepare accrual accounts

Your charity’s accounts must give certain details about payments and benefits to trustees. Check the Charities’ SORP or seek professional advice.

SORP explains the accounting rules for charities that prepare accrual accounts.

Charities that prepare receipts and payments accounts

You should include details of payments you made to trustees. For example, who you paid, why you paid them, what you paid them, and the power or authority for the payment.

Check what type of accounts your charity must prepare.  

Extra guidance for charitable companies

Only read this section if your charity is a charitable company.

If your agreement to pay a trustee covers a period of at least 2 years, you must:

• first have Commission authority under section 201 of the Charities Act 2011
• then, under company law, have your members’ approval

You can consult your members first. If you do, and your members approve the decision, their resolution must state that their approval is subject to getting section 201 authority.

If you need section 201 authority, you will need to explain why the arrangement is in the charity’s best interests.

Apply for section 201 authority.

If your charity has a single trustee

Your charity’s governing document will say if your charity is allowed to have one trustee.

If your governing document does not contain a power to pay the trustee for trustee duties, you would need authority from the Charity Commission to introduce one. The Commission would not usually provide authority for this.

If your charity’s governing document does contain a power, it will usually include the payment rate. (This is usually where the trustee is an organisation such as a bank). If you want to change the rate, you must get authority from the Commission. 

If the Commission agreed, we would usually only authorise a rate that reflects the value of the work done for the charity rather than a higher rate that is in keeping with the organisation’s published, commercial, rates.

Read guidance about changing governing documents and how to apply for authority.