Finance FAQs

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1.  Why do we need to make a Parish Offer during a clergy vacancy?

Paid ordained ministry is a key part of delivering mission within the Anglican Church. However, there is so much more to ministry; chaplaincy within schools, colleges, prisons; reaching out to minority or excluded members of society; making new Christians and growing the church through making new connections in a huge variety of ‘non-traditional’ church contexts. Add to this a plethora of requirements on the church; safeguarding, governance and compliance. Much of this vital work goes unseen by many, but is all part of why everyone’s giving makes a difference, and why mission is at the heart of Common Fund.

During a ‘vacancy’ the Diocese continues to incur ministry-related costs; fees to voluntary ministers, upkeep of and improvements to clergy housing, training of new ordinands and curates, legal costs, etc. Your Parish Offer to the Common Fund does so much more than ‘pay for a bit of a vicar’.

It’s vital that the parishes of a benefice that finds itself in ‘vacancy’ make every effort to demonstrate good stewardship, generous giving, proper financial management, and financial viability – or are actively working on a plan to make themselves financially viable and sustainable. Prospective clergy, viewing advertisements and Parish Profiles will be keen to ensure that they benefice they might wish to come to, is both financial stable and has a generous heart; and they are likely to be considering any number of alternative appointments. Ensuring Parish Offer continues to be met during a vacancy is a key way of demonstrating this.

As the church, ‘the Body of Christ’ we are members together and we are interdependent on each other. Together our pooling of Parish Offer to the Common Fund enables the provision of ministry across the diocese; your giving during a vacancy will be supporting essential ministry and mission elsewhere; during a vacancy in another parish, continuing Parish Offer to the Common Fund from that place may well be helping to fund ministry in your communities and churches.

At one level this can be seen as just being a question about money; a necessity to ‘pay the vicar’. However, there is much more here, that goes to the heart of our faith and beliefs as followers of Jesus Christ. What we have, we have in common, and this is never truer than when we are thinking about the mission of the Church. Common Fund is actually a ‘mission fund’, to which all of us, through our personal, regular, planned giving, can contribute. Those who have more should contribute more to this work, along with those who have less.

This is key to answering the question “Why do we still make a Parish Offer to Common Fund during a vacancy?” Common Fund is not a contribution to ‘buy a bit of a vicar’. Rather, it is the pooling of all our giving and resources to allow the mission of the church to flourish and to allow ministry to respond to changing circumstances. It is biblical based on Acts 4:32, where we read that everything was held in common, with benefactors laying at the feet of the Apostles the proceeds of their property sales. So ‘Common Fund’ does what is says on the tin; it’s our way of attempting to give sacrificially for the good of the whole and this giving is always in response to God’s overwhelming generosity to us.

Top Tip

Don’t keep the answers to yourself! Reproduce this FAQ resource and share with your PCC, in your local church magazine and with members of your wider congregation.

On our Parish Offer page you’ll find more helpful information about the Common Fund including a short video clip you could show to your PCC as part of a wider discussion.

Further Help and Support

If you would like any further help and support to your parish, in connection with any of the points raised here please contact a member of the Diocesan Finance Team or one of our Parish Giving Advisers.

Tel: 01432 373300
Links: Generous Giving

2.  What do I do with parochial fees?
Parochial fees are those fees payable for wedding, baptisms, funerals, cremations and burials.  The level of fee is set by the Church of England, and an element of this is payable to the Diocese.  The part of the fee due to the Diocese does not form part of the Parish income.  The fee should be submitted to the Diocese on a monthly basis using a standard form.  More details can be found on the Wedding and Funeral Fees page.
3.  What is the PCC's Charity Commission number?

If the gross income of a PCC exceeds £100,000 in any one year, it must register with the Charity Commission.  (Please note that a PCC can no longer seek a written determination to not register with the Charity Commission if annual income is exceptionally above £100,000.)  If annual income is below £100,000 the PCC is currently* treated as an 'excepted' charity and will not have a Charity Commissioner registration number.  If a PCC is asked for its governing document, the PCC should state that it is governed by two pieces of legislation:

* The current 'exception' from registration for religious charities such as Church of England PCCs has been extended by The Charities (Exception from Registration) (Amendment) Regulations 2021 No.55 until 31 March 2031, although we can expect the Charity Commission to require some larger PCCs to register during the 2020s.  After 2031, all PCCs with annual income over £5,000 will be required to register with the Commission.

A PCC can download a PDF document that includes the church name, address and church code from the 'More Information' section of its A Church Near You listing (example). This PDF, which is an extract from the Church of England’s database of churches, can serve as a certificate for churches requiring proof of their charity status when registering for online and card-based giving.  You will need to request a certificate by clicking on the download button and filling in a short form.

Note that a PCC will have an Inland Revenue charity reference number if it submits claims for the recovery of Income Tax on Gift Aid donations.  Self-evidently, this is not the same as a Charity Commission registration number, but it may be accepted by certain organisations as supplementary evidence of the PCC's charitable status.

4.  What is a restricted fund?
A restricted fund consists of donations given for a particular parochial purpose. These donations, together with any tax recovery if they are given under Gift Aid, must be held separately and shown separately in the PCC annual accounts. The most common type of restricted fund is a "Fabric" fund.  Please click on the link to obtain further guidance on different types of funds and accounting for different types of funds.
5. The PCC has a deposit account with the local bank but it pays very low interest, are there any alternatives available?
The Church of England encourages its Parishes to use the Central Board of Finance for its short term deposits as this gives a higher rate of interest than any local bank and will make the funds available on request.
6. What is an Annual Report?
An Annual Report is the written report that accompanies the annual accounts giving information about the activities of the Parish for year under review. Further guidance can be found here.
7.  Is there a difference between a 'designated' fund and a 'restricted' fund?
Yes, a designated fund is where a PCC may decide to put some General Fund money aside into another fund for a particular use, e.g. for building repairs. This means the PCC can move amounts back into the General Fund when the repairs are completed, i.e. re-designate or un-designate the fund. A restricted fund can only be used for its named purpose.
8.  Who can be an Independent Examiner?
An independent person who has no connection with the PCC and who is reasonably believed by the PCC to have the requisite ability and practical experience to carry out a competent examination of financial statements.  Further infomation can be found in Chapter 11 of the PCC Accountability book.
9a.  How to account for Accounting for Statutory Fees in PCC books & records:

Statutory fees are those fees payable to the Diocese for wedding and funerals.  The portion of the fee that is due to the Diocese can be found in the Parochial Fees Table.

The PCC income for the year must only include the fees that are due to the PCC and not the full (gross) fee collected for the wedding/funeral. 

Where the accounts are produced on an accruals basis, the portion owed to the Diocese is entered as a creditor.  When the fee is paid over to the Diocese, the creditor will reduce to zero.

Where the accounts are produced on a receipts and payments the simplest way to account for this is to include a contra column/account which records both the receipt and the payment.  At the end of the year, the contra column/account should total zero. To avoid difficulties at the year end, it is recommended that all Diocesan fees are paid over within the accounting year.

9b. How to account for non-PCC collections in PCC books & records:
For example, the PCC members attend a Christmas lunch.  Each member pays £15 (the full cost) in advance to the PCC and then the PCC settles the bill.  In this case the PCC is simply acting as agent and neither the income nor the payment should be included in the PCC accounts.  The simplest way to account for this is as above, to include a contra column/account which records the receipt and the payment.  This column/account should after the payment has been made, total zero.
9c. How to account for Funeral collections for nominated charities in PCC books & records:

Where there is an agreement between the family and minister that part or all of the collection is to go to a nominated charity, then the PCC is acting as collecting agent for the nominated charity.  The collection should be banked by the PCC and a corresponding payment made directly from the PCC to the charity.  The simplest way to account for this is as above where both the receipt and the payment are recorded in a contra column/account which nets down to zero.  Neither the income nor the payment is included in the PCC's annual accounts.

Further detailed information on funeral collections is available here.

10. How to treat payments for administrators, cleaners, organists, bell rings etc.
The critical point to establish is whether someone is employed or self-employed.  The Parish Resource website contains a wealth of guidance in this area,  in particular the section on 'Paying people' The question as to whether someone is self-employed is one that is answered by an examination of the facts/circumstances, rather than a decision by the PCC.  If you require further clarification please do get in touch with us by e-mailing the Finance Team.
11.  Does our PCC need to make pension contributions for any of our staff?
Please refer to the guidance on pensions and auto-enrolment on the Parish Resources website.
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