Registered charities and Community Amateur Sports Clubs (CASCs) can claim an additional 25p for every £1 donated by an individual. This whopping 25% boost on donations is known as Gift Aid and it can soon add up. As accountants working with a number of charities, we are well aware of the difference this extra money can make to that fantastic work you are all doing.
How do you claim gift aid?
To claim gift aid on a donation from an individual, the donor must complete a gift aid declaration form AND have paid more than the Gift Aid recovered on the gift amount in either Income Tax or Capital Gains Tax during that tax year. Charities make a Gift Aid claim either via a form sent through the post or online. Online requests are usually paid out via BACS in around 4 weeks so it’s a fast way to access the extra money.
Remember that charities need to keep a record of declarations for 6 years after the most recent donation and the information must include the donors declaration form stating the charity name and the donors full name and address, with the door number and postcode as a minimum.
Can Charities and CASCs claim Gift Aid on donations from a limited company or through Payroll Giving schemes?
No, charities and CASCs can not claim Gift Aid on donations from a limited company or through Payroll Giving schemes.
Useful information about Gift Aid
- Charities can claim gift aid on cash and contactless card donations of £30 or less under the Gift Aid small donations scheme (GASDS). You do not need to identify the donor or have them complete a Gift Aid declaration to claim up to £2,000 donated this way in a single tax year. Talk to us for more information about this scheme.
- If your charity uses a community building, such as a village hall or religious building, you might be able to claim gift aid on donations made inside the building OR from within the same council area as your community building.
For somewhere to count as your community building, you need to have hosted at least 6 charity events in that building, all attended by at least 10 people.
- Your donors may be able to claim tax relief of their donations if they pay the higher rate of tax in England or Scotland. Why not use this information as part of your fundraising message, as many people are unaware of this benefit.
- Remember to claim gift aid within 4 years of the end of the financial period in which you received the donation. You have to claim within 2 years for cash donations.
- Watch out for scams! A few years ago there was a company offering to make cash donations in return for shares – others have tried to claim for non-existent cash donations. If something sounds too good to be true, give us a call and we’ll help you sort out the genuine from the fraudulent.
- HMRC has published a very useful guide that explains all you need to know about Gift Aid. However, if you would prefer bespoke advice that’s pertinent for your charity, feel free to contact us for a no obligation conversation about other ways you can get the support you need.
Remember that we are here to help: giving you access to experienced accountants and useful information and support no matter your charity’s size or sector. If you would like a no obligation discussion about how we can help you, please feel free to contact the team on 01992 444466. We’re accountants for business and we’re here to help you grow.
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The information contained above is for general guidance purposes only. Whilst every effort has been made to ensure the contents are accurate, please note that each individual has different circumstances and it is essential that you seek appropriate professional advice before you act on any of the information contained herein. HB Accountants can accept no liability for any errors or omission or for any person acting on or refraining from acting on the information provided in the above