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Following the unprecedented number of telephone donations to charity during and since the tsunami appeal, the Government will make it easier for charities to claim Gift Aid on those donations, the Chancellor of the Exchequer Gordon Brown has announced
Following consultation with charities, HM Revenue and Customs will remove the requirement on charities to write to each individual donor to confirm that Gift Aid can be claimed following their telephone donation.
The changes will reduce the costs of many charities, especially those organising major appeals for telephone donations, allowing them to spend more time and money on fundraising and charitable activities and less on paperwork and administration.
Speaking to the annual conference of SCIAF (The Scottish Catholic International Aid Fund), Gordon Brown said:
A few months ago the tsunami showed the world not only the power of nature to destroy but also the power of humanity to build anew. Extraordinary, spontaneous support, financially and physically, to meet the needs of others.
And it is in recognition of the extent of immediate giving by phone and internet that we are making it easier for donations to SCIAF and all charities - even when made by telephone - to attract tax relief and thus extra money for the cause.
HM Revenue and Customs (HMRC) will lay regulations on 11 October to change the requirement in the Gift Aid rules relating to the making of a qualifying donation.
The current criteria for a qualifying donation state that the donor must make an “appropriate declaration”, and the current regulations “The Donations to Charity by Individuals (Appropriate Declarations) Regulations 2000” set out the requirements for such declarations. Where a declaration is given orally (e.g. over the telephone) the current regulations require the charity to send a written statement to the donor giving them a 30-day period within which to cancel the declaration. The new regulations will remove the requirement to write to the donor, where the charity has maintained satisfactory records linking the donor to the making of a declaration.
The new regulations will come into force on 1 November 2005.
The provisional figure for Gift Aid donations in 2004/05 is £2,213m, net of tax. A further £625m in tax was paid to charities on these donations.
6. More details on Gift Aid can be found on the HM Revenue & Customs' website at www.hmrc.gov.uk/charities.
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