Gift Aid and Charitable Giving

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Donors can give effectively to charities using Gift Aid, Payroll Giving or Self Assessment return.

What is Gift Aid?

Using Gift Aid means that for every pound you give, the charity gets an extra 28 pence, helping your donation go further. So for every £10 you give the charity will get another £2.80 from the government.

On top of that, if you are a higher rate taxpayer you can claim further tax relief on the donation in your annual tax return.

So next time you want to give to charity, tell them you want to Gift Aid it and they will do the rest.

Now try the Gift Aid Calculator

Enter your donation here £

Now see what your donation with Gift Aid CAN be!

The basic rate of income tax is 22% hence the full value of your donation including Gift Aid will be £

and if you pay the higher (40%) rate of income tax you can reclaim higher rate tax relief of £

What is Payroll Giving?

If your employer runs a payroll Giving scheme you can donate to your chosen charities from your salary before tax is deducted, so you get tax relief straight away, for example, if you are a higher rate tax payer and you give £100 per month it only costs you £60.

Find out from your payroll department if your employer is one of the many offering a Payroll Giving scheme, if they don't, why not suggest they set one up?

Gifts of shares and securities or land and buildings

You can get income tax relief when you donate quoted shares and securities, land or buildings to charity. For example, if you donate shares worth £1000 you could reduce your income tax bill by £400. No capital gains tax will be due on the gift.

What is Self Assessment Return?

A new way introduced only this year (2004) is you ability to donate all or part of your tax repayment to a charity of your choice using your Self Assessment return. Here's how it works.

• Tell the inland Revenue how much you want to give. If you want to give all of the repayment tick box 19A.1 on your self assessment return. If you want to specify a maximum amount enter that in box 19A.2.
• Choose your charity. Charities taking part in this scheme have been given a unique code number. The list of charities and their code numbers are at http://www.hmrc.gov.uk/charities/charities-search.htm
• If you already give to a charity you may know the code number. Alternatively you could contact them for the code. The code number is different from the Registered Charity number usually displayed on charity mailings.
• If you can't obtain the number from the charity or the internet, telephone the Inland revenue on the number shown in your Self Assessment return.
• Enter the code for your chosen charity on your return at box 19A.3 Please take care to enter the code correctly.
• For Gift Aid to apply tick box 19A.4 This will mean that the charity will get an extra 28% from the Inland Revenue, helping your donation go further and without costing you any more.
• If you make a donation using Gift Aid and are a higher rate taxpayer you can claim further relief on this in your tax return for 2004/5.

Your donation will be anonymous unless you inform the Inland revenue that they can give your details to your chosen charity by tick in box 19A.5

The list of charities you can give to will be updated quarterly. But don't delay sending the Inland Revenue your return if your chosen charity doesn't appear on the list - you need to get your return in by 30 September if you want the Inland Revenue to calculate your tax and by 31st January to avoid penalty for late filing.

If you haven't got a repayment but want to give to charity, or the charity isn't on the list, you ca give in other ways - and do it tax effectively by the methods already explained.

The LMS Carriage Association's Self Assessment return unique code number is PAQ80CG

FOR MORE INFORMATION SEE YOUR TAX RETURN GUIDE OR GO TO http://www.hmrc.gov.uk/charities/