Have you been asked to sponsor someone recently for a charitable event? Do you pay a regular amount every month or every year to a charity such as the National Trust? The chances are there is a tick box to treat the payment as having been made under Gift Aid.
This increases the value of the gift to the charity by 25p for every £1 you give – Pay £100 and the charity claims Gift Aid of £25, ending up with £125.
Higher rate taxpayers can claim tax relief through their Self-Assessment tax return or by asking HMRC to amend the tax code. The gross gift is £125 which goes on the tax return. The tax relief due to the payer is the difference between the 40% tax rate and the basic rate of tax claimed by the charity. This is 40%-20% = 20%, So, a tax reduction of £25 arises.
If you have not made such a claim, you can go back up to four years – so if a claim is made after 6 April 2021 in the 2021/22 tax year, claims can be made for the tax years from 2017/18 onwards.
Contact us if you think you might qualify. We will send you a document to record your donations.
