Gift Aid

[ɡɪft eɪd]

Term

Summary:

Gift Aid allows charities to claim an additional 25% on top of the original donation. It can also have tax benefits for the donor.

More detail:

Gift Aid is a tax-relief system in the United Kingdom that allows charities to claim an additional 25% on top of Charitable Donations made by UK Taxpayers. Donors must say that their donation should be treated as Gift Aid, and must pay more Income Tax or Capital Gains tax than is being claimed by the charities.

If the individual is a Higher Rate or Additional Rate taxpayer, then they can claim Income Tax relief for the difference between their tax rate and the Basic Rate on the donation. This can be done through a Self Assessment.

Self-employed individuals are also able to claim Gift Aid.

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