The Institute of Fundraising has now submitted its response to the Governments consultation on Gift Aid.
Our single most important recommendation:
In order for Gift Aid to work better it must be a simpler system and process for the public to participate in and less bureaucratic for charities, in order to benefit. This must be complemented by support and an awareness raising campaign for both the general public and charities.
The Institute proposes that a formula be agreed by consultation between the Government and the sector to determine the amount of Gift Aid a charity can claim, based on its level of voluntary income. Such a formula would take into account the proportion of the general public who give to charity and their tax paying status. We estimate that this will increase Gift Aid by at least £400 million.
In one step this system will remove the need for massive paper trails and maximise income from tax relief to charities, allowing them to get on with their core work.
The Institute is calling on Government to effect this fundamental change to release the real potential to Gift Aid and benefit charities of all size or cause.
Read our Full Response (106kb)
The Institute also believes that it is vital that any reform or change to Gift Aid is also supported by a major national media campaign. It has called on the Government to invest in a significant awareness raising campaign that is focused on both charities and the donating public.
The Institute has also recommended a number of other changes to better support the current Gift Aid scheme.
- Reform of Gift Aid for Higher Rate Tax Payers so that the charity benefits from the full 40 per cent tax rebate.
- Simplification of Gift Aid in relation to Gifts in Kind.
- Reversal of Corporate Gift Aid so that charities, not corporate bodies, benefit from the Gift Aid rebate.
- Development of a Gift Aid scheme that allows the UK corporate sector to donate unused goods and reclaim the rate of Gift Aid on the gifts value as a legitimate business expense.
- Reform of Gift Aid audits to make them simpler and more balanced around major areas of risk.
- Research into the potential for the creation of a Central Gift Aid register.
We are delighted that acevo, NCVO, Charity Finance Directors Group, the Charity Tax Group, Charity Shops Association and the Church Of England have all joined us in calling for this major simplification of Gift Aid.
