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05 April 2012
No documented link between givers and payments of up to £20
A new charitable giving scheme will allow organisations to claim a top-up payment equivalent to gift aid on cash donations of up to £20, without needing to obtain a declaration from the donor.
Under HMRC's proposed gift aid small donations scheme (GASDS), scheduled to come in to effect from 6 April 2013, most qualifying charities and sports clubs will make claims in the same way as for gift aid, but there will also be differences, including:
- There will be no documented link between the donor and the payment; donors will not need to give personal information.
- The charity will be required to have a good, recent track record of making gift aid claims.
- Claims will be based on the tax year, rather on the accounting period of a charitable company or trust, and be made within one year of the end of the tax year in which the small donations are collected.
- The amount that can be claimed will be limited to £5,000.
- Charities must continue to make gift aid claims if they wish to make a claim under the GASDS.
- Qualifying donations must be pure gifts, although a small token of negligible value, such as a lapel sticker, may be given.
- Higher-rate and additional-rate taxpayers will not be able to claim tax relief on donations because the GASDS is not a tax relief.
The scheme cannot be legislated through the usual Finance Bill cycle because it is not a tax relief. It will be legislated separately.
The Revenue has issued a consultation document that covers the plans. Comments should be sent by email no later than 25 May 2012.
