Understanding Gift Aid​

 

Did you know that charities are losing a staggering £560 million a year because eligible donors just aren't ticking the Gift Aid box.  It may seem a simple fix, but because of the way the scheme is structured, supporters always need to be opt-in rather than opt-out.  Understanding what Gift Aid is, is the biggest hurdle, so here are some of the a frequently asked questions that people ask.

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What is Gift Aid?

Gift Aid is a government scheme that allows charities to reclaim the tax that you have already paid on your donations through income tax or capital gains tax.

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Why do I need to make a declaration?

Your declaration gives NDAS authority to reclaim tax from HM Revenue & Customs on your gift. By making the declaration, you are confirming that you understand this.

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How do I know if I am a UK taxpayer?

You ARE a UK income tax payer if:

• Tax is taken from your wages or pension before you receive them

• You have to fill in a self-assessment form

• You have any taxable savings (in a building society, for instance), or a pension plan, or investment income

• You have recently paid any capital gains tax, or expect to pay it in the near future. This could be on the sale of a property or some shares, for example

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If any of these apply to you, please complete and submit your declaration today.

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Do I have to make a declaration with every gift? Does the Gift Aid scheme include previously given donations?

When you provide a Gift Aid declaration it will cover all of the eligible donations you have given up until 4 years previous (in tax years, 6 April – 5 April) and on any donation you may make in the future, so only one declaration is required.

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What if I was a taxpayer last year, but am not this year (or vice versa)?

Please call the Finance Team on 0300 012 0154 who will be able to record details of this change.

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How can NDAS reclaim 25% when the basic rate of tax is currently 20%?

This is because the basic rate of tax is calculated on the gross amount of the donation. This means we can reclaim 20% of the amount you earned before tax was deducted, which works out to be 25% of the amount that we receive. To find out the exact amount of tax that NDAS can reclaim, multiply the amount of your donation by 20 and then divide it by 80.

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What if I pay tax at the higher rate?

Charities are only able to claim back tax at the basic rate, but that 25% is still so important to us, so please still complete and return the declaration form.

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As a higher-rate taxpayer you have the right to reclaim tax on your charitable donations. All you have to do is remember to include details of your charitable gifts on your self-assessment tax form to claim your additional personal tax relief (this being the difference between the basic rate of 20% and your higher rate).

If you would like a receipt for eligible donations that you have made, then please contact our Finance team on: 0300 012 0154.

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What if I am a pensioner?

You may still be paying tax on a private pension plan or a savings account, or pay capital gains tax if you sell either a property or shares. You are still eligible if you have paid enough tax during the year to cover your donations (i.e. 25% of the value of your gifts).

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What if I have agreed to Gift Aid to another charity?

You can support as many UK charities as you like through Gift Aid. All you need to do is return a declaration to each charity that you support and ensure that you are paying enough tax during the year to cover your total annual donations.

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I am not a taxpayer but my partner is, and our donations are made jointly.  Are our gifts still eligible?

Yes, your gifts are still eligible for Gift Aid, but we need your personal details separately for our records. Please contact our Finance Team on 0300 012 0154 and they will send you a special form to fill in.

To confirm, if you are giving jointly, the person or persons who complete a Gift Aid declaration must be named on the account from which the donation is made.

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What about money paid under an old deed of covenant?

If you had a covenant in existence on 5 April 2000, you can continue to make the payments due under that deed of covenant until it expires without having to complete a Gift Aid declaration. However, due to the age of such covenants, we would advise and welcome that you re-confirm your agreement to the scheme by completing a new Gift Aid declaration.

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If you make additional gifts or change the value of your gift under the original covenant, you must complete a new Gift Aid declaration to cover those gifts if you want us to be able to recover the tax on them.

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Can I withdraw a declaration on a particular gift?

If, for any reason, you decide that your gift should not be included in Gift Aid – for example, if you think that you will not pay enough tax to cover the tax reclaimed by us – then simply call our Finance Team on 0300 012 0154 and ask for the declaration to be withdrawn or for a particular gift too be excluded from the scheme.

However, please note that it is your responsibility to notify us of any withdrawal from the Gift Aid scheme as soon as possible – for example, if you stop paying tax or you think that a donation you are making would not be eligible for the scheme. Thank you.

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Can I stop giving?

Completing a Gift Aid declaration does not put you under any obligation to give again – it merely ensures that we can reclaim tax on the donations that you have already made and any you may make in the future, so that your gifts go further at no extra cost to you.

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I am participating in an event and my sponsors would like to Gift Aid their donations.

If you haven’t already done so, please contact our events team on 0300 012 0154 or info@ndas-org.co.uk to let them know what event you are taking part in and they will be able to provide you with support and materials should you need them. This includes sponsorship forms where each sponsor can record their details to enable Gift Aid to be claimed on their offline donation.

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Please note that the original sponsorship forms need to be sent in with your offline fundraising donations. Unfortunately, we are unable to accept copied or rewritten forms for Gift Aid.

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