News

HMRC gives charities four months to prepare for online gift aid

Fundraising | Celina Ribeiro | 3 Dec 2012

More than a year and a half after announcing the move to online gift aid filing, the HMRC late last Friday afternoon published details of the new scheme, giving charities just four months to get their systems in order.

Chancellor George Osborne announced the move to online gift aid submission in the Budget of 2011, but it took until 30 November 2012 for details to be published. The HMRC on Friday also sent out communication to nearly 500 of the biggest gift aid claimants to advise them of how the new system will work.

As revealed this September, the new system will come into effect in April 2013 and will replace the present paper-based system. It will comprise of three levels; charities which do not have internet access can submit their claims by paper forms, but these will differ from present system – the paper option will be set out like a passport form, in which each letter needs to be in a separate box and the HMRC will not be accepting photocopies for repeat donors. The two other routes are web-based; for charities with less than 1,000 records, they will be able to upload their database to the HMRC web portal, 'Charities Online' while charities with any more than 1,000 records will have to link their data with the HMRC system – a link which will likely require database upgrades or changes.

The system is designed to be more secure, cheaper and faster than the present paper-based gift aid scheme. It will also enable charities to claim Gift Aid Small Donations Scheme payments.

However, the short time frame between the details being published and the scheme coming into effect has got the Institute of Fundraising concerned about charities ability to implement necessary changes.

A spokeswoman for the Institute told civilsociety.co.uk that the organisation would ideally like a period of six months for the two schemes – past and present – to overlap.

“Overall, online filing will be a good thing for charities,” she said. “It’s just about this transition period, the implementation needed… The time scale is quite short.”

The Institute is now getting in touch with its organisational members to warn them of the coming changes and gauge the preparedness of charities.

The spokeswoman said the system was likely to impact on different organisations in different ways. For many, the new scheme will be a benefit. However, for many the new scheme will require updating or altering their databases, which could involve un-budgeted for costs and delays, should CRM providers be inundated with new update requests. For charities with bespoke CRM systems, it is likely that they will have to take on a developer to make the changes. 

Directory: Institute of Fundraising