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- Managing Cash Flow
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How can your charity make the most of Gift Aid?
In the 2023/24 tax year, £1.6bn was paid to charities in Gift Aid and this valuable income stream continues to be relied upon by the third sector, especially given the ongoing challenges.
Gift Aid contributes an additional 25% of revenue to charities on qualifying donations, i.e. 25p for every £1 donation, and can be claimed by a recognised Charity or a CASC (Community Amateur Sports Clubs) registered with HMRC, if the 3 main conditions are met:
- It is a gift to a charity.
- The individual making the donation has paid or due to pay UK tax e.g. income tax, capital gains tax, or both.
- An appropriate gift aid declaration is made by the donor.
Keep your Gift Aid strategy up to date
Good governance around Gift Aid is hugely important in ensuring the correct amount is claimed and an effective opt-in strategy remains essential to amplify donations. We have outlined below a few tips to ensure your Gift Aid strategy is up to date:
- Ensure clear documentation and records are maintained linking donors with their gift aid declarations.
- Make the declaration process as easy as possible, digitisation and automation provide a straightforward way to opt-in and easily track declarations.
- Raise awareness of Gift Aid amongst donors highlighting the benefits to your charity.
- Invest in training and upskilling of staff on Gift Aid & ensure the team are up to date on any changes in legislation.
- Seek specialist assistance through free courses on Gift Aid e.g. Charity Finance Group run webinars on Gift Aid.
- Ensure donor information especially digital records are stored securely.
For more guidance on Gift Aid, please visit the Charity Finance Group Gift Aid Hub where there are some excellent guides in their Knowledge Hub."
