Charity benchmarks: is our charity normal?
Trustees often ask whether their charity’s admin costs, reserves or fundraising spend are “normal”. The honest answer is that there is no single normal, and the most popular benchmarks — admin cost percentages and cost per £1 raised — are widely regarded as misleading. This page shows what can be sourced, what it does and does not mean, and how to compare your charity sensibly.
Across charities with income over £500,000, about 88% of all spending went on charitable activities and about 8% on the cost of raising funds (Source: Charity Commission register, sector overview, 9 July 2026) — but there is no single “normal” ratio, and using one to judge a charity is widely regarded as misleading.
Why “admin cost %” and “cost per £1” can mislead
Before any number, the health warning. Almost every serious analyst of the charity sector treats overhead ratios as a poor, and sometimes harmful, measure of a charity. There is no universal “good” ratio, and the Charity Commission has deliberately not set one, focusing instead on whether spending is proportionate and transparent. Charities differ so much — a grant-maker, a hospice and a campaigning charity are not comparable on a single percentage — that a benchmark treated as pass/fail does more harm than good.
Low overheads are not automatically good. Research finds that underinvesting in the “back office” — finance, systems, people, governance — can weaken a charity and damage the outcomes donors care about; cutting overheads too far compromises results. Yet there is a real tension here: the Charity Commission’s “Public trust in charities 2026” research (published 8 July 2026) found that “most of the money raised is spent directly on the causes the charity supports” remains the single most-selected driver of trust, chosen by 55% of the public — up from 53% in 2025 (Source: Charity Commission, Public trust in charities 2026, gov.uk, accessed 10 July 2026) — even though experts regard it as a misleading measure. This page tries to respect both facts — to inform trustees without feeding a myth.
What the sector actually spends on
At the aggregate level, most charity spending goes on charitable work, not overheads. Across charities with income over £500,000 — the group required to report detailed finances — about 88% of expenditure went on charitable activities and about 8% on raising funds, with the rest on other costs. This is a sector aggregate for larger charities, not a target for yours, and it says nothing about what any individual charity should spend.
Chart 1 (for Ivan to build): sector expenditure split (charitable activities / raising funds / other) for charities with income over £500,000. Free to reuse with attribution to CharityIQ and the Charity Commission register.
Where sector spending goes (charities with income over £500,000)
Charity Commission register, sector overview, 9 July 2026:
| Expenditure type | Amount | Share |
|---|---|---|
| Charitable activities | £86.18bn | ~88% |
| Raising funds | £8.26bn | ~8% |
| Other | £3.64bn | ~4% |
| Total expenditure | £98.10bn | 100% |
Shares are calculated by CharityIQ from the register figures. This covers only charities with income over £500,000; smaller charities do not report this breakdown, so it cannot be extended to them.
Reserves: what charities typically hold
There is no set number of months’ reserves a charity should hold. A common rule of thumb is three to six months of running costs. The most detailed sourced evidence we could find is a 2020 academic study analysing over 12,000 sets of accounts filed with the Charity Commission by charities with income over £500,000 (the group required to report reserves in detail), which found a median reserve level of 3.92 months of expenditure — ranging from an average of 4.21 months for charities with £500,000–£1 million income down to 2.86 months for those with income over £100 million (Source: D. Clifford, University of Southampton, and J. Mohan, Third Sector Research Centre, University of Birmingham, “Assessing the Financial Reserves of English and Welsh Charities on the Eve of the Covid-19 Pandemic,” November 2020, as reported by Civil Society News, 11 November 2020, accessed 10 July 2026). Separately, a Third Sector analysis of the accounts of 157 of the UK’s best-known charity brands found they held an average of almost four months’ expenditure in reserve (Source: Third Sector, “Best-known charities hold an average four months of reserves,” 13 April 2018, accessed 10 July 2026). These are descriptions of what charities do, not a standard to hit, and both studies are several years old — we have not found a more recent, equivalently detailed sourced study. The Charity Commission’s CC19 guidance sets no target and expects trustees to justify their own level based on their risks and commitments.
The spread matters as much as the average. The same 2020 study, conducted on the eve of the Covid-19 pandemic, found a significant minority of charities were thinly covered: 21% held less than one month’s reserves, 43% held less than three months’, and one tenth had only a few days’ expenditure in reserve (Source: Clifford & Mohan, November 2020, as above, accessed via Civil Society News 10 July 2026) — which is the real risk a reserves policy exists to manage. Read reserves alongside your income reliability and commitments, not against a benchmark.
Chart 2 (for Ivan to build): distribution of reserves held (months of expenditure), from published research. Free to reuse with attribution; cite the specific study used.
Benchmarks by charity size
The figures trustees most want — typical admin share, fundraising cost, reserves and staff/volunteer ratios by income band — are not published in a clean, sourced form, so we compute them from Charity Commission register aggregates rather than quote a number we cannot stand behind. Until those computations are run and checked, the tables below are placeholders with the method stated. Every figure will carry its source, its date, and a note that it describes charities of that size, not a target for yours.
How big is a typical charity in each income band
| Income band | Active charities | Median annual income | Median annual expenditure |
|---|---|---|---|
| Under £10k | 47,258 | £3,305 | £3,115 |
| £10k–£100k | 59,703 | £27,889 | £26,364 |
| £100k–£500k | 27,933 | £192,811 | £181,411 |
| £500k–£1m | 5,980 | £685,924 | £654,885 |
| £1m+ | 9,308 | £2,736,019 | £2,620,511 |
Charity Commission register, active England & Wales charities with a filed income, 10 July 2026 (150,182 charities). This shows the size profile within each band — a charity’s income and spending are usually close, as most spend nearly all they raise. The benchmarks trustees ask about most — spend on charitable activities as a share, reserves in months, and volunteers per charity — come from the register’s detailed (SORP) accounts, filed only by larger charities — shown in the next table where the data allows.
Charity spending, reserves and volunteers by income band
These are the benchmarks trustees ask about most. Two of them — reserves in months and the share of spending on charitable activities — come from the register’s detailed (SORP) accounts, which in practice only charities with income above about £500,000 file. Smaller charities file simpler receipts-and-payments accounts that do not report these, so their cells below are blank: a real gap in what the Commission collects, not missing analysis. Volunteer numbers (from the annual return) cover charities of all sizes.
| Income band | Median reserves (months of spending) | Median spend on charitable activities | Median volunteers* |
|---|---|---|---|
| Under £10k | not reported (non-SORP accounts) | not reported | 6 |
| £10k–£100k | not reported (non-SORP accounts) | not reported | 12 |
| £100k–£500k | not reported (non-SORP accounts) | not reported | 20 |
| £500k–£1m | 4.3 | 98.9% | 29 |
| £1m+ | 4.0 | 97.4% | 50 |
Charity Commission register, latest annual return per charity, 10 July 2026. Reserves and charitable-activities share are from Part B (full SORP accounts) — about 5,900 charities in the £500k–£1m band and 9,100 in the £1m+ band; there is essentially no Part B data below £500k. *Median volunteers is among charities that report using volunteers (Part A; ~7,000 charities in the smallest band up to ~57,700 in the £10k–£100k band). Read the charitable-activities share carefully: under SORP, “expenditure on charitable activities” is a broad category that includes the support and overhead costs of running programmes — it is not “the percentage that reaches beneficiaries”, and a figure near 98% does not mean 2% overhead. It is exactly the kind of ratio this page warns against reading as a score. The ~4-month median reserves for larger charities matches the published research cited above (Clifford & Mohan: median 3.92 months).
How to benchmark your charity sensibly
Used well, benchmarks prompt good questions rather than deliver a verdict. Compare like with like — charities of similar size, cause and operating model — and pay most attention to your own figures over several years, since a trend in your own numbers is more meaningful than a snapshot against a mixed average. When a ratio looks unusual, treat it as a question to explore (“why did our fundraising cost rise this year?”), not a mark out of ten.
Read every figure in context: your reserves against your risks and commitments; your spending against your plans; your staffing against what your work needs. A charity investing in systems, safeguarding or a new fundraiser may show “worse” ratios in a year that is actually making it stronger. Context beats comparison, every time.
Methodology and sources
- Sector expenditure split is read from the Charity Commission register “sector overview” (charities with income over £500,000), dated 9 July 2026; the percentage shares are CharityIQ’s calculation from those figures and are rounded.
- The position that overhead/admin ratios are misleading, and that the Commission sets no prescribed ratio, reflects Charity Commission guidance and the settled view across sector bodies (ICAEW, NCVO and others). We cite it as a position, not a statistic.
- Reserves norms: the “three to six months” figure is an unattributed rule of thumb repeated across the sector (kept as such, not stated as researched). The specific, sourced figures — median 3.92 months (range 2.86–4.21 months by income band); 21% held less than one month; 43% held less than three months; one tenth held only a few days’ expenditure — are from D. Clifford (University of Southampton) and J. Mohan (Third Sector Research Centre, University of Birmingham), “Assessing the Financial Reserves of English and Welsh Charities on the Eve of the Covid-19 Pandemic” (November 2020), as reported by Civil Society News, 11 November 2020, accessed 10 July 2026. The “prominent charities ~4 months” figure is from Third Sector’s analysis of 157 leading charity brands’ accounts, 13 April 2018, accessed 10 July 2026. Both are the most detailed sourced studies we could find; both pre-date 2026, so treat them as historical evidence of typical reserve levels, not a current benchmark, and replace with newer research if a more recent equivalent study is published.
- Public trust in “how much goes to the cause” is now sourced to the Charity Commission’s “Public trust in charities 2026” research (published 8 July 2026, gov.uk, accessed 10 July 2026): “most of the money raised is spent directly on the causes the charity supports” was selected by 55% of the public in 2026 (up from 53% in 2025) as the top driver of trust.
- Income-band benchmarks: from the Charity Commission register (active England & Wales charities, 10 July 2026; 150,182 with a filed income) we computed the size profile of each band — the number of charities and the median annual income and expenditure. The metrics trustees ask about most — reserves in months and the charitable-activities spend share — come from the register’s detailed (SORP) Part B accounts, filed only by charities above roughly £500k income; below that they are genuinely not reported, so those cells stay blank. Volunteer numbers come from Part A and cover all sizes. About 15,000 charities have Part B reserves + charitable-activities data; ~110,000 report a volunteer figure.
- Overriding rule for this page: no benchmark figure is published without a source and date; where a figure cannot be sourced or computed, it is left as a flagged placeholder, never guessed. This page is quoted in trustee meetings, so accuracy outranks completeness.
Cite this page
Free to reuse with attribution. Suggested citation:
CharityIQ (2026), “Charity benchmarks: is our charity normal?”, drawing on Charity Commission for England and Wales register aggregates (Open Government Licence v3.0), CC19 reserves guidance, and published sector research. Available at: https://charityiq.co.uk/data/charity-benchmarks/ (accessed [date]).
Changelog
- 10 July 2026: first published. Sector expenditure split from register data dated 9 July 2026; reserves norms from CC19 (updated 14 Jun 2023), Clifford & Mohan’s Nov 2020 reserves study and Third Sector’s Apr 2018 analysis (all named and sourced inline and in the Fact Table); public trust claim sourced to the Charity Commission’s Public trust in charities 2026 research (published 8 Jul 2026); income-band benchmarks to be computed and populated from register datasets before figures are shown.
CharityIQ compares your charity against like-for-like peers using verified register data, and shows the source for every figure — so a benchmark starts a useful conversation instead of a misleading one.