This year it is expected that UK charities will miss out on £1.2 billion in donations because of tax-inefficient giving by donors.
New research from Unbiased.co.uk, the professional advice website, found that some simple changes to giving practices could help charities net over £1 billion a year in money that is currently being wastefully claimed by the taxman.
UK adults gave a total of £9.9 billion to charity in 2007/08. According to this research, these gifts could be boosted by nearly 12.5% if donors had made full use of the tax allowances available to them.
The most tax efficient way to donate to charity is via Gift Aid. This is a form of opt-in tax relief on money donated to UK charities, allowing the charities to reclaim basic rate income tax relief on the money.
With Christmas fast approaching, and little prospect of the Treasury making the Gift Aid system ‘opt-out’ rather than ‘opt-in’, this is a simple way to ensure you make the most of any charitable donations.
