Gift Aid is an easy way to help your charity or CASC maximise the value of its donations. We can reclaim tax from HM Revenue & Customs (HMRC) on the 'gross' equivalent of donations, their value before tax was deducted at the basic rate, currently 20 per cent. You can work out the amount of tax you can help us reclaim by dividing the amount donated by four. This means that for every £1 donated, we can claim an extra 25 pence.
For more information on how Gift Aid works and if your donation is eligible visit the HMRC website here: http://www.hmrc.gov.uk/charities/gift_aid/basics.htm
Donations that qualify for Gift Aid
Gift Aid can only be claimed on gifts of money from individuals, sole traders or partnerships, in any of the following forms:
- Direct Debit
- credit or debit card
- postal order
- standing order or telegraphic transfer
Gifts made by cheque only count as received once the cheque has cleared. Your charity or CASC can accept gifts of money made in sterling or any foreign currency.
Payments that don't qualify for Gift Aid
- donations of money from a company
- donations in the form of a loan waiver or debt conversion - for example an individual may lend money to your charity or CASC and then, at a later date, agree that it does not have to be paid back - this is not a gift of money it is the waiver of a loan
- gifts made on behalf of other people for example a membership subscription paid on behalf of somebody else - this is a gift of membership from the payer to the member not a gift made to the charity or CASC
- gifts that come with a condition about repayment
- gifts with a condition that the charity buys goods or services from the donor
- payments received in return for goods or services - these are not gifts - for example payment for admission to a concert, payment for a raffle ticket, an entrance fee for an adventure challenge event etc
- a 'minimum donation' where there is no choice about payment - this is simply a fee for goods or services, it is not a gift
- gifts made using 'charity vouchers' or 'charity cheques'
- donations received before the date that HMRC accepts your organisation as a CASC or a charity for tax purposes