MSE News: Budget 2011: Giving to charities via Gift Aid to be simplified

Former_MSE_Helen

This is the discussion thread for the following MSE News Story:

"The Chancellor says the Gift Aid changes are the 'most radical reforms to charitable giving' for a long time ..."

Read the full story:
Budget 2011:Giving to charities via Gift Aid to be simplified

london_lass

I work for a national charity and am very interested in following this as well as the statement about inheritance tax reductions for people leaving estates to charity. Legacies are a huge part of our income and anthing that makes this easier for people to do so is great!

Bargainetta

I Giftaid just about everything I give to charity shops including family and neighbours donations. Not difficult once the initial form filled in. On subsequent visits I just give my surname, postcode and house number. That's all they need. You don't need to have a giftaid registration card with you. Making inheritance giving easier is a good idea though. They will need a boost because quite a lot of people in the coming year will be dropping out of earning enough to pay income tax anyway. Plus the 3% extra is disappearing to (which used to make 25% up to 28%)

rb10

Looks great.

A question though, about the limit of £10.

Is this limit per person (per tax year)? Or per donation? So if someone were to donate by a monthly standing order of £5, would that be automatically eligible for Gift Aid?

I haven't been able to find any more details on this proposal - this site is the only one where I can find a quantifiable amount as to what a "small donation" is. It would be much appreciated if anyone could point me in the right direction.

janschophile

The £10 limit does not appear to be about about ongoing donations.
HMRC's budget announcement explains
"Gift aid: records for small donations
From April 2013 charities and community amateur sports clubs that receive small donations of £10 or less will be able to apply for a Gift Aid style repayment without the need to obtain Gift Aid declarations for those donations. The amount of small donations on which the new repayment can be claimed will be capped at £5,000 per year, per charity. In order to qualify for this new repayment, charities will need to have been recognised by HMRC for Gift Aid purposes for at least three years, have been operating Gift Aid successfully throughout that time and have a good tax compliance record. The Government will be consulting with charity representatives on the details of the new scheme over the summer 2011. "

Annabee

Does anyone know what happens if you say 'yes' to GiftAid, but then do not actually pay tax in the year? Does the charity get the money anyway? Does anyone actually check you are a tax payer?

Could the Inland Revenue come after you for the money later on?
Its just the charities always assume everyone is able to say 'yes' to this. Like on Comic Relief last week, they kept saying 'when you are asked about GiftAid, just say yes!'

labman_3

Annabee wrote: »

Does anyone know what happens if you say 'yes' to GiftAid, but then do not actually pay tax in the year? Does the charity get the money anyway? Does anyone actually check you are a tax payer?

Could the Inland Revenue come after you for the money later on?
Its just the charities always assume everyone is able to say 'yes' to this. Like on Comic Relief last week, they kept saying 'when you are asked about GiftAid, just say yes!'

I process the Gift Aid for a charity. My understanding is that although the refund is paid direct to the charity, it is treated by HMRC as if you received it yourself and then passed it to the charity.

So this means if the charity claims a refund that you weren't entitled to, HMRC would come to you for repayment and not the charity. (And expect you to inform them about this if they don't come to you first.)

On the claim form submitted by the charity, only the name of the donor and the amount is listed, so no automatic checks take place. But I suppose there's nothing to stop HMRC doing a spot check or an investigation. This might lead to them requesting the donor's address from the Gift Aid Declaration made to the charity. (And possibly a nasty surprise for the donor!)