Changes to charity tax relief thresholds (1): gift aid

Changes to charity tax relief thresholds (1): gift aid

Tuesday, 26 February 2019

Charity fundraisers need be aware of two changes to tax relief thresholds that apply from 6 April 2019.

Charities often encourage donations by giving a small reward to their donors. Where this is more than token value, this needs to be measured and assessed against value thresholds to make sure that gift aid can still be claimed. The benefit value thresholds will be simplified slightly in April, reducing the thresholds from three to two. The new limits will be:

  • For donations up to £100: 25% of the value of the gift (as before)
  • Donations over £100: £25 plus 5% of the excess over £100
  • Maximum annual benefit £2,500 (as before)

As before, beware of some pretty grey areas in the gift aid rules on assessing benefits ‘associated with’ donations. Take care! (Or take advice.)

The Gift Aid Small Donations Scheme (SDS) allows charities to claim a gift aid type benefit of 25% of donations without requiring a personal declaration. Until now, the maximum donation under SDS has been £20. This limit will increase in April to £30, making a small difference to charities that receive impromptu small donations from individuals, e.g. from bucket collections.

Giles Kerkham

Need help?

If you have any questions or if you’d like to discuss this with us in more detail, please speak to your usual Larking Gowen contact or call 0330 024 0888 or email enquiry@larking-gowen.co.uk

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