Charity Tax Reliefs and Gift Aid

Charities are eligible for a number of tax reliefs. The most significant of these is Gift Aid, and CFG has been closely involved in the process of reforming this over the past three years. April 2013 sees a number of important changes come into effect, in particular, the introduction of online filing of Gift Aid claims for charities (something which CFG has called for over a number of years) is a vital step forward, moving this aspect of Gift Aid firmly into the twenty-first century. We continue to work closely with HMRC to further improve Gift Aid, and welcome your views and input with any of our work - please email policy@cfg.org.uk with any thoughts or opinions.

CURRENT WORK

Business Rates

The Welsh Government recently consulted on changes to the business rates relief available to charities. The proposals included a significant scaling back of current reliefs, and as well as being highly concerning for charities with charity shops in Wales, this could also signify a potentially worrying direction of travel for rates reliefs more widely.

CFG submitted a strongly worded response in opposition to most of the proposals by the Welsh Government, you can read our response here. In particular, we highlighted the underlying rationale for charity rate reliefs, which was largely absent from the proposal document, and the wide-ranging benefits which charity shops bring to both local communities and charities' beneficiaries. Our response was also featured in Civil Society, you can read the article here.

Review of Gift Aid and digital giving

Following announcements in the Chancellor’s Autumn Statement 2012 and in Budget 2013 of a review of Gift Aid in a digital age, CFG is working with HMRC and HM Treasury to examine whether Gift Aid can be improved to work better with newly emerging forms of giving.

HM Treasury is aware that the current legislative framework for Gift Aid limits the feasibility of new giving platforms and products linking in to the scheme.  We are thinking about how we can increase flexibility without increasing risk of fraud.  Therefore, We would like to hear from members on emerging trends in giving, and thoughts and ideas on how Gift Aid can be developed to work better with these. We would also be very interested in hearing about any other issues that your charity has experienced in the administration of Gift Aid, and the impact of this on potential income through the scheme. Please email policy@cfg.org.uk to share your views.

Online Gift Aid claims - Charities Online is now up and running!

The new 'Charities Online' system came into effect 22 April 2013, and should make it quicker and easier to claim Gift Aid. However, charities only have until the end of September 2013 to switch over to the new system, which will replace existing paper forms.

CFG and other sector bodies have put together 'CHARITIES ONLINE' - IS YOUR CHARITY READY?  covering the need-to-know facts.

Under the new system charities will have three options for making claims:

  1. Online form – best suited to claims of <1,000 donors. Details can be submitted electronically through a spreadsheet attached to an online claim form.
  2. Through your own database – best suited to claims of >1,000 donors. Charities choosing this option will be able to send one claim per day directly from their own internal database, with details for up to 500,000 Gift Aid donors. Charities wishing to use this system will either need to develop a compatible software package in-house or purchase a suitable package from a software provider.
  3. New paper form – aimed primarily at charities without access to the internet. The form will have to be ordered directly from HMRC. Guidance on how to prepare can be found on HMRC's website.

Gift Aid Small Donations Scheme - beginning 06 April 2013

This new scheme enables charities to claim a Gift Aid-like rebate on cash donations of less than £20 up to a value of £5,000 per year. Recent proposed amendments to the regulations mean that charities can claim on donations made up to two years previously, rather than one. 

Basic level guidance is available and more detailed guidance should appear on HMRC's website shortly.

CFG has been closely involved with the development of the GASDS since its announcement in Budget 2011. As well as many meetings with key decision-makers in HMRC and Parliament, CFG submitted a consultation response and produced this parliamentary briefing.

CFG is backing Britain's charities

As part of this sector-wide campaign we are asking Government to modernise and promote Gift Aid and Payroll Giving so that every pound donated can go further! For more information on the ‘Back Britain’s Charities’ campaign and the campaign’s top five asks, or to sign you or your organisation up to the campaign, see the website.

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