Small Charity - What can we collect Gift Aid on?

kelda_shelton

Hi there,

Would appreciate any advice people could give me on gift aid.

I am treasurer for a small Scottish registered charity - run entirely be volunteers that provides musical education and where locals can make music in a group setting.

We have just got the appropriate letter to note that we are now registered for gift aid.. but I'm now trying to work out what we can use it for and get money back on.

I know if individuals give monetary donations and they are tax payers they can complete a form for us to get the gift aid back but how does it work for the following?

Can we get gift aid on these things? :

- Annual 'subscription' of £125 by adult members / £100 for under 18's towards costs.
- We have a bonus ball scheme (with the appropriate gambling licence)
- We have a patron scheme (2 free tickets to a concert and a quarterly newsletter)
- We have a sponsor scheme (sponsor a player and an advert goes on our website)
- We play gigs for organisations/ individuals and they pay a fee - if we asked for a suggested donation instead we could get the gift aid on those paid by individuals?
- We hold 2 concerts per year and sell tickets to these.
- Raffles / auctions
- Any fundraising events like racenights / balls / dances?

Also, are there any other things I may not have thought of that we can claim gift aid on? We do a lot with a youth slant, so wasnt sure if there was anything there?

All help or signposting gratefully received!!

Thanks,

Savvy_Sue

I'd suggest that there's a lot of guidance already on the HMRC website- there's a whole section on valuing the benefits you provide - and hopefully your auditor (or whoever inspects your accounts) will have a bit more knowledge.

What you need to remember is that you can only claim Gift Aid if the donor pays sufficient UK tax (income or Capital Gains) to cover the tax which charities are reclaiming. So if most of your money comes from young people who are NOT taxpayers, then there's no Gift Aid. Until you've successfully claimed for a couple of years, you won't be eligible for the Small Donations Scheme, which lets you claim Gift Aid on cash donations under £20 even without a Gift Aid form.

I know that when my boys were in Scouts, I was able to complete a Gift Aid form for their subs payments. I'd therefore start by getting a compliant Gift Aid form drawn up.

kelda_shelton

Thanks Savvy_Sue. I had a look on the HMRC - but I found it a little hard to navigate to be honest.. but I'll take another look...

Thats good to hear about the subscriptions.

Any other tips from others greatly appreciated

Savvy_Sue

Oh I know the HMRC site isn't always easy to navigate, but the info is all there!

If you have a local (or even Scots!) umbrella body for volunteers you may find they can help point you in the right direction too.

kelda_shelton

Thanks for the link directly into the body of the guidance - it helped me to navigate it a bit more. Somebody also suggested you can get gift aid back on youth related activities but I can find absolutely no mention of it on HMRC - despite your help?

Anyone heard of this or perhaps they are thinking of VAT or something?

Savvy_Sue

I doubt it is the youth-related thing which is important, it is likely to be the 'benefit' test.

It's not something I'm 100% up to date on though, but I know that when we sell auction tickets for our charity, the online giving sites ask various 'test' questions to see if there's a Gift Aid claim in it or not.

Google volunteer plus your local area / town and see if there's anything more local than Volunteer Scotland, then get in touch with them and ask for some advice.

redpete

kelda_shelton wrote: »

Thats good to hear about the subscriptions.

I'm fairly sure that gift-aided subscriptions for scouts / guides is specifically for those organisations and does not mean that all subs for any organisation can be gift-aided. See the HMRC guidance here.

Navigation from this page is fairly straightforward and includes some of the specific situations you asked about.

kelda_shelton

Thanks for the heads up.

Thought I should note the outcome of this should anyone come across this thread later..

I called HMRC today to confirm - using the tel no in this link - http://search.hmrc.gov.uk/kb5/hmrc/contactus/view.page?record=XqbRdlnT_mo

They asked a couple of scenarios/ questions and explained the following:
For the subscriptions to be eligible for gift aid, the subscriptions paid must not be used to personally benefit any one individual. So:
· None of the subs must be paid to any individual (i.e. conductor / volunteer expenses)
· Subs cannot be used to fund uniforms
· Subs cannot be used to fund any personal benefits.


I explained that the Subs were used to pay rent, insurance and other general costs e.g buses and so on, but not conductor expenses or uniforms – as these are paid by various fundraising activities. HMRC said they were happy for subscriptions to be gift aided on the basis that there was no individual benefit.

Deanevans

Any donations of article for sale in a charity auction can be gift aided, you claiming gift aid on the sale price of the article.
A new scheme, called the small donations scheme, allows you to claim gift aid on small cash donations, whether or not the giver is a tax payer. The cash bucket that is passed around at a function or gig would qualify. Individual donations have to be less than £20. There are limits to how much you can claim, linked to how much you claim from regular gift aid.

Savvy_Sue

Deanevans wrote: »

Any donations of article for sale in a charity auction can be gift aided, you claiming gift aid on the sale price of the article.
A new scheme, called the small donations scheme, allows you to claim gift aid on small cash donations, whether or not the giver is a tax payer. The cash bucket that is passed around at a function or gig would qualify. Individual donations have to be less than £20. There are limits to how much you can claim, linked to how much you claim from regular gift aid.

It's a great scheme, but I'm not sure the OP will be able to benefit from this immediately, I got the impression that you had to be successfully claiming Gift Aid before you could use it. As a new charity, they'll need to get a claiming history under their belts.