Details of Gift Aid Donor Benefit Rules Published

The government has published details of its plan to simplify the rules around how much benefit charities can give to donors and still claim Gift Aid, which will come into effect from April 2019.

HMRC and Treasury carried out a consultation in 2016, the results of which were published in 2017. The chancellor, Phillip Hammond, announced the government’s intention to simplify the rules in the Budget.

Under the current system charities are allowed to provide a donor with benefits worth 25% of the first £100 they give, then £25 of benefit on donations up to £1,000, then 5% of the total above that, up to a maximum of £2,500.

From April 2019, the amount of benefit a donor can receive will be 25% of the first £100, then 5% of any part of the donation that exceeds £100, with a maximum total value of £2,500.

The government has now published the draft legislation for consultation and policy paper explaining its thinking.

“The changes in this measure will introduce a simpler and a more generous two threshold benefit valuation rule for charities, making it easier to claim Gift Aid on eligible donations and so increase the overall number and value of claims,” the paper said.

It said that the impact on the Exchequer is expected to be “negligible”.

A spokesman for the Charity Finance Group said: “Change in the right direction, however modest, is always to be welcomed. We urge government to not stop at modest amendments but to go further to simplify the system if we are to close the gap between gift aid claimed and gift aid eligible on donations”.

Source: Civil Society, 9 July 2018

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