Charities are missing out on “hundreds of millions of pounds” because 23% of eligible donors do not use Gift Aid, the Charities Aid Foundation (CAF) has warned.
As part of CAF’s UK Giving research YouGov surveyed nearly 800 people between October and December 2021. Some 68% of full-time workers say they use Gift Aid when they donate to charity.
Gift Aid is worth £1.3bn a year to the charity sector, but according to the Charity Finance Group more than £500m is unclaimed.
Gift Aid is a scheme which allows registered charities to reclaim income tax on a donation made by a UK taxpayer. For basic-rate taxpayers this adds approximately 25% to the value of any donation. Higher-rate taxpayers can also claim 25p for every £1 they donate in personal tax relief.
The latest UK Giving Report found that people donated £11.3bn to charities in 2020, and recorded the highest proportion of people using Gift Aid, but CAF says the scheme is still underused.
Mark Greer, managing director of philanthropy services at the Charities Aid Foundation, said: “Charities rely on mass giving and regular donations from generous individuals. But when an eligible taxpayer donates and forgets to tick the Gift Aid box, the charity misses out.”