THE HEADLINES SAY 'TV stars in charity tax dodge inquiry'. Not quite the perfect headline I guess as there is no mention of vicars sex or royalty but still fairly emotive stuff. Recent reports allege that several well-known celebrities have used (or abused) the tax relief rules for charitable giving and the offices of a well-known firm of accountants have been searched by HMRC. So what exactly is going on here?
No doubt we are all aware of the 'Gift Aid' scheme which has made donations by companies and individuals fairly simple; although HMRC are conscious that a simple scheme can be easier to use for tax avoidance purposes.
In brief TA 1988 s 339 allows companies to make a donation to charity as a cash Gift Aid payment. The payment is made gross relief is given against corporation tax and there is...
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