Gift aid and income for tax credits

Horlock

When you complete a tax return, you declare the amount of gift aid giving you have made over the year. They then deduct this amount from your income to come up with your taxable income and then charge you tax.

On your tax credits form you are asked what your income for the year was. Is this the income before gift aid, or your taxable income? Would GAYE make any difference to this?

(without meaning to be rude - do you think when posting answer you could give some justification - eg I work for IR, or says so on page 14 of ... guidlines, or just "I think this is the case because when I filled out the form someone told me etc. I don't want to be done for fraud and say someone on the internet told me.

[Deleted User]

why not just tele HMRC on monday?

Horlock

To answer my own question

http://www.hmrc.gov.uk/forms/tc825.pdf

Basically, deduct then declare.

zagfles

Horlock wrote: »

To answer my own question

http://www.hmrc.gov.uk/forms/tc825.pdf

Basically, deduct then declare.

Yes - and don't forget the gross up the contributions, as described on the above form.

zagfles

Horlock wrote: »

When you complete a tax return, you declare the amount of gift aid giving you have made over the year. They then deduct this amount from your income to come up with your taxable income and then charge you tax.

Not quite - they extend your basic rate band by the amount of the grossed up contributions (because the charities claim basic rate relief). Unless you pay higher rate tax, or you're in the age allowance taper, you don't get any tax back.