The economic secretary to the Treasury asked Parliament for an advance of £250,000 to develop the IT systems for charities to claim gift aid online yesterday, and revealed the system is expected to launch in April 2013.
Sajid Javid, who replaced Chloe Smith in last week’s reshuffle, said in a written ministerial statement that an advance from the Sanctions and Penalties Contingency Fund was needed to enable the IT provider to develop and test a system that will enable charities to make claims under the small donations scheme online by April 2013 as well as the gift aid scheme.
“Starting the work early gives the IT provider sufficient lead-in time to have the IT ready for the start of the gift aid small donations scheme in April 2013,” he said.
The new system will let charities claim gift aid and make claims under the gift aid small donations scheme using the same forms and processes.
He explained that: “If the work on the new scheme were to be delayed until after Royal Assent then HMRC would incur increased costs of around £1.3m.”
This is because the small donations claim element of the system would have been integrated at a later date, instead of from the start, which would take time and result in IT development costs as well as requiring the whole system to be tested again.
The intention to introduce an online system for gift aid claims was announced in the 2011 Budget. As long as the Small Charitable Donations Bill becomes law, HMRC will become responsible for administering the scheme, including the costs of developing the IT systems.
The second reading of the Small Charitable Donations Bill took place last week with ministers on both sides calling on the Treasury to simplify some measures.