Can a Charity or Nonprofit Sue for Defamation? UK Guide

Charities and nonprofits can be devastated by false allegations — a campaign claiming a charity misappropriates funds or is a front for criminal activity can destroy donor confidence and threaten an organisation's survival. But can a charity actually bring a defamation claim? The answer is yes — but with an important additional hurdle.

The Serious Financial Loss Requirement

Under section 1(2) of the Defamation Act 2013, a body that trades for profit must show the defamatory statement has caused or is likely to cause serious financial loss — not just serious harm to reputation. Charities that engage in trading activities — selling merchandise, running commercial events, or operating trading subsidiaries — are caught by this provision.

Evidence of serious financial loss includes: measurable declines in donation income, loss of a major grant or corporate partnership that can be causally linked to the false statement, and withdrawal of key fundraising relationships. Courts require real and substantial financial consequences, not merely reputational injury or speculative future harm.

Common Defamatory Attacks on Charities

• False allegations that the charity misappropriates donor funds or pays inflated salaries to trustees.
• False claims that the charity is a front for criminal, extremist, or fraudulent activity.
• Malicious Charity Commission complaints published publicly alongside or instead of being submitted privately.
• False statements about financial management, governance, or beneficiary treatment.

Trustee and Staff Personal Claims

Where defamatory statements are made about named trustees, chief executives, or senior staff as individuals — rather than about the institution itself — those individuals have personal defamation claims without needing to meet the serious financial loss test. Personal and institutional claims can often be pursued simultaneously, and in many cases the personal claim provides the clearer legal route.

Charity Commission Complaints and Qualified Privilege

A formal complaint to the Charity Commission made in good faith attracts qualified privilege, protecting the complainant provided they acted without malice. However, where the complainant simultaneously publishes the same allegations on social media, to the press, or to donors, those additional publications are fully actionable. This pattern — a regulatory complaint combined with a public campaign — is the most common charity defamation scenario we encounter.

Related reading: Corporate defamation claims | Defamation Act 2013