Reform gift aid rules, says Institute

Fundraising | Celina Ribeiro | 17 Aug 2009

Higher rate tax payers should automatically receive full tax relief according to the Institute of Fundraising, which today renews calls for reform.

The Institute has delivered a proposal to the Treasury calling for it to consolidate the donation tax relief for higher rate taxpayers into one process, potentially increasing values by two thirds.

The current system sees higher rate tax payers claim gift aid on donations and then, if they complete a self assessment, they can claim and donate their tax relief at the end of the financial year. A survey of higher rate tax payers by Charities Aid Foundation found that awareness of this kind of tax relief is low, preventing charities from receiving the maximum income from donations from top earners.

The Institute is pushing for changes to be agreed on in the autumn pre-budget review and brought into practice in 2010.

The umbrella body, which is working with other sector organisations to lobby for a gift aid ‘opt-in’ system, says the reforms would mean a donation of £1,000 would be worth £1,666 to the charity, after gift aid and other tax relief is processed.

Director of policy and campaigns at the Institute, Louise Richards (pictured) said the request was not “radical”. “There is no reason why [the government] should not implement these changes”, she said.

Directory: Charities Aid Foundation | Institute of Fundraising
Who's Who: Celina Ribeiro

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