There are some alarming recent headlines about Gift Aid, with the conclusion being drawn that nobody is quite sure if it’s helpful for charities!
According to a new National Audit Office report, the reliefs cost the taxpayer around £940m in 2012/13 while it is impossible to conclude that reliefs on donations in their current form provide value for money.
While the research shows the importance of properly administering tax reliefs on donations in order to protect the reputation of the charitable sector and give confidence to donors, there is insufficient evidence that government has actively encouraged take-up of the reliefs.
It also found that HMRC has not collected the data which would enable it to conclude how tax incentives since 2000 have affected donor behaviour or if they have increased the value of donations.
It all sounds rather odd.
But what’s important here for our clients is that they help the organisations they wish to support, alongside understanding tax guidelines when it comes to charitable giving.
Please don’t hesitate to get in touch with the Midas team if you have any questions. It’s a very straightforward element of tax relief, so it’s a shame to see these sensationalist headlines confusing the issue!
