A charity that supports armed forces veterans through gardening projects has announced it will close at the end of the year, saying that it has been unable to raise enough money in a “crowded” military sector.

In a statement on the Gardening Leave website trustees said that they are in discussions about transferring projects to other organisations. It has projects in London, Glasgow, Ayr and Dundee.

They said: “It has been well publicised that fundraising in the charitable sector has been very tough in recent months.

“Like many small charities, particularly in the crowded armed forces and veterans sector, we have been finding it increasingly difficult to secure adequate, sustainable funding and, despite our best efforts, over the autumn we have not received the level of income anticipated.”

Gardening Leave was set up in 2007 to support veterans with mental health issues through outdoor activities.

Its accounts for the year-end March 2015, filed with Companies House, show a total income for the year of £408,000 and expenditure of £391,000. It employed an average of 12 people throughout the year and had 25 volunteers.

Its general reserve fund was £18,000, below its target £98,000, which equated to three months’ expenditure.

The charity had current assets worth £159,000 and fixed assets of £10,000 with liabilities of £6,658.

It was one of the beneficiaries of the Guardian and Observer newspapers’ Christmas appeal in 2014.