More than 300 charities and sector bodies in the UK have joined a coalition to campaign for a two-year Gift Aid Emergency Relief package to help those facing loss of income during the corona crisis.
Gift Aid allows charities to claim back the basic rate of tax their donors have paid, providing them with an extra 25p for every £1 given with an eligible donation. The coalition estimates that making the change to Gift Aid could help charities access an additional £450 million over the two years.
Led by Charities Aid Foundation, the Chartered Institute of Fundraising, Charity Finance Group, NCVO and Charity Tax Group, and including charities such as Marie Curie, the Scouts, Alzheimer’s Society and the London Philharmonic Orchestra, it is proposing raising the amount of Gift Aid that can be claimed on donations from a quarter to a third. As an example, this would mean that a £100 donation from a UK taxpayer would increase to £133.33 for the charity once Gift Aid had been claimed. This compares to the current £125.00.
To help smaller organisations, which are less likely to use the Gift Aid scheme, the coalition is also seeking changes to the Gift Aid Small Donations Scheme (GASDS), which lets charities claim Gift Aid on donations under £25 without a Gift Aid declaration, up to a total of £2,000, to ensure that all small charities can access it.
It would like to see the removal of the ‘matching rule’, which would mean that the amount of GASDS top-up smaller charities can claim doesn’t depend on the amount of Gift Aid they have claimed in that tax year.
It is also asking the government to increase the eligible donations that can be claimed under GASDS from £8k to £10k, using the same temporary rate for GASDS as proposed for the Gift Aid Emergency Relief.
Increasing Gift Aid has the potential to help many charities in the UK, with figures showing that over 70,000 charities claimed Gift Aid in 2019, and over 120,000 charities known to be registered for Gift Aid and the Gift Aid Small Donations Scheme.