The Ministry of Housing, Communities and Local Government announced tougher political donations rules on 6 July 2026, with Secretary of State Steve Reed setting out reforms including a one-year restriction on large donations from returning overseas electors and profit-based checks on company donations.
The measures were published on 6 July 2026 as part of the government’s response to the independent Rycroft Review. They are intended to tighten political finance rules across parties, candidates and companies involved in UK elections.
The reforms will be taken forward through amendments to the Representation of the People Bill. The Bill is due to return to the Commons for Report stage in the week commencing 13 July.
New Rules Target Foreign Money In UK Elections
The package is intended to strengthen political finance safeguards by limiting foreign influence in UK elections and tightening rules governing donations from individuals, companies and prospective candidates.
Ministers said the reforms would close loopholes that could be exploited by people seeking to interfere in UK elections. The measures also build on earlier plans announced in March, including a hard cap on overseas elector donations and a ban on crypto donations.
- Individual donors: New timebound restrictions will apply to large donations from people recently based overseas.
- Companies: Donations will be assessed against post-tax profits rather than revenue alone.
- Candidates: Pre-candidacy funding will face new proof and declaration requirements.
Main Political Finance Reforms
| Area | New Measure | Stated Purpose |
|---|---|---|
| Overseas donors | Timebound cap | Limit foreign influence |
| Company donations | Profit-based test | Check legitimacy |
| Candidate funding | Source proof | Increase transparency |
Overseas Donors Face A Timebound Cap
Under the reforms, people returning to the UK from overseas will be subject to a one-year restriction before they can make political donations above the permitted threshold. Ministers said the measure is intended to prevent individuals from returning to the UK shortly before making large political donations.
Individuals returning to the UK will be subject to the cap for at least a full calendar year. The government said this is intended to stop the rules being dodged by people returning from overseas before making large donations.
Company Donations To Face Profit-Based Checks
Companies will face tougher checks under the reforms, with political donations assessed against post-tax profits over the previous five years. The government said this would replace reliance on revenue alone when assessing donation capacity.
The new approach measures donation capacity against post-tax profits over the previous five years rather than turnover alone, with ministers arguing this provides a clearer indication of a company’s genuine financial position.
- Profit test: Company donations will be assessed against post-tax profits over five years.
- UK connection: Businesses must show a genuine link to the UK or Ireland.
- Accountability: The system is intended to reduce reliance on revenue-only checks.
Donation Rule Changes
| Donation Type | Previous Concern | New Requirement |
|---|---|---|
| Returning individuals | Overseas funding route | One-year cap period |
| Companies | Revenue-only checks | Post-tax profit test |
| Pre-candidacy gifts | Limited visibility | Declare above £2,230 |
Candidate Funding Rules Strengthened
Candidates will be required to prove that campaign funding received before they formally become candidates came from legitimate sources. The measure is intended to close a gap in the current system where money received before the regulated campaign period can later be used during an election campaign.
Candidates will also have to declare donations above £2,230 received before officially becoming a candidate. The announcement said this change would increase transparency around funding that is currently not covered by the same requirements.
Rycroft Review Recommendations Accepted
The reforms form part of the government’s response to the independent Rycroft Review. Ministers confirmed that the remaining recommendations from Philip Rycroft’s independent review have been accepted in full.
The Electoral Commission and the Committee on Standards in Public Life were cited among groups whose views had been considered. The response also reflects evidence provided by the Electoral Commission and the Committee on Standards in Public Life.
Ministerial Comments
Steve Reed, Secretary of State said;
“British democracy is not for sale. These tough new rules will shut down dodgy funding, stop foreign money influencing our elections and keep our democracy strong.
By holding overseas donors to tougher standards and requiring candidates to prove where their funding comes from, we are taking world-leading action to protect the integrity of our elections and tackle the threats we face from abroad.”
Samantha Dixon MP, Minister for Democracy said;
“The overwhelming majority of people who take part in our democratic process do so honestly and transparently, but our rules must keep pace with new and emerging threats.
These reforms will close loopholes that can be exploited by those seeking to influence UK politics through foreign money, while strengthening transparency around campaign funding and company donations.
This means political decisions are made only in the interests of voters in the United Kingdom.”
Darren Jones, Chief Secretary to the Prime Minister said;
“For too long, foreign money, foreign bot farms and foreign powers have exploited the system, trying to warp our elections and sow division in our country for their own ends.
We’re cracking down on those trying to buy – and sell – our democracy and putting the British people first. If you want to donate to our politics, you need to have legitimate and longstanding roots in our country.”
Bill Amendments And Parliamentary Timetable
The reforms will be taken forward through amendments to the Representation of the People Bill. The amendments will be introduced through the Representation of the People Bill, which is scheduled to return to the House of Commons for Report stage during the week beginning 13 July.
The Bill already includes requirements for companies making donations to show a genuine connection to the UK or Ireland. The latest measures add further checks on company finances, candidate funding and large donations from people with recent overseas links.
The reforms introduce tighter controls on political donations from overseas-linked individuals, strengthen financial tests for company donations and increase transparency around candidate funding before the formal election period. Ministers said the measures implement the remaining recommendations of the Rycroft Review and are intended to reinforce public confidence in the integrity of UK elections.
Sources: Ministry of Housing, Communities and Local Government, Samantha Dixon MBE MP, The Rt Hon Steve Reed OBE MP and The Rt Hon Darren Jones MP.
Prepared by Ivan Alexander Golden, Founder of THX News, an independent news organisation delivering timely insights from global official sources. Combines AI-analysed research with human-edited accuracy and context.
