Gift Aid...

[summerdays]

I thought I understood Gift Aid... you know the charity claims back the tax that I paid on that amount of money - they end up with more money - I get rid of stuff I don't need and feel that I've done my bit.

Now I have been sent an email telling me how much money they have made from my donations to the charity shop ... and that they are going to claim the Gift Aid on it... but reading the following:

One of the requirements of HMRC is that we write to you before we can make a claim for Gift Aid on your donation. This means that as we sell more of your donated goods, we will have to write to you again. We are sorry that this might seem a waste of time and resources, however it is the only way we are allowed to claim the 28% additional Gift Aid revenue from HMRC.

Legally, we are obliged to offer you the proceeds from the sale of your donated goods. If you wish to claim back this money (less a commission of 5% plus VAT), please contact us in writing

What a waste of time and effort ... I'm wondering if its worth donating and giving them the details... and as for offering me my money back... well I can see some people suddenly seeing that thinking actually I need a bit extra and there go their funds.

 

[accountantpete]

Most of them went "professional" about 10 years back so now have huge layers of middle management on basics plus percentage of "profits" relying on donations and volunteers to keep them in a style to which they have grown accustomed.

Ask them what % of your donation finds its way down to the people they are claiming to support.

 

[Vidor06]

I work with dmoan who is another cyclechat member and he is doing the Belfast Marathon on Monday and has nominated Concern Worldwide as his charity. He has set up a Just giving page and they have a fairly robust explanation of how the gift aid thingy works. I hadn't a clue about it until I read this.

Our 5% fee goodness

Charities pay a 5% fee on donations (which we take from the Gift Aid we reclaim) and in return we help them raise more money, more efficiently. By leaving the costly and time-consuming stuff to us, they can spend more time, energy and money on doing good.
Here’s what we’re busy doing for our 5% fee

• Running, monitoring 24/7 and constantly improving JustGiving’s technology so it can handle high levels of traffic while meeting the latest security and banking standards.
• Constantly creating new fundraising tools and services for charities, at no extra cost.
• Taking full responsibility for the Gift Aid we claim on charities’ behalf, being regularly audited by HMRC.
• Providing dedicated customer service for charities and their supporters, giving prompt and expert advice.
• Giving charities full access to their data, helping them track and analyse their fundraising success.
• Providing free training and support to charities (especially the small ones) on how to raise even more online.
• Giving you a clean, junk-free experience. We’ll never spam you, sell you anything or pass your personal details on to a third party. Ever.

Here’s how we charge our 5% fee

1. You donate £10 and we send it to your charity that week.
2. We reclaim Gift Aid from the government (which takes a month), adding £2.82 to your donation.
3. We take our 5% fee (+VAT) from the Gift Aid, with credit/debit card/PayPal charges, and send all the rest to the charity. So for every £10 you give, the charity gets almost £12, and they get it faster.

Your donation£10Gift Aid + supplement£2.82Our 5% fee£0.64VAT @ 17.5%£0.11Credit card fee @ 1.45% £0.15Total cost to charity£0.90Total donation£11.92

• Debit card (16p),
• PayPal (1.6%),
• Visa Delta/Electron (23p),
• business credit cards (1.85%),
• business debit cards (30p).

If your donation isn’t eligible for Gift Aid, we take our 5% fee from your donation. Because over 85% of donations through JustGiving are eligible for Gift Aid, charities always end up raising more with us.
Charities also pay a monthly subscription fee of £15 + VAT for our service. http://charities.justgiving.com/what-charities-say-about-justgiving/

 

[ASC1951]

What a waste of time and effort ...

I was going to say "what absolute cobblers, the charity have got it wrong", then I thought I should look it up. To my surprise, they are absolutely correct - here are the HMRC rules. http://www.hmrc.gov.uk/charities/gift_aid/rules/retail.htm#2

If you want to save the charity and yourself all the fuss, IMO you can just lodge a declaration with the shop which says "I am xxx of xxxx and I am a UK taxpayer. I irrevocably authorise xxxx charity to sell any donations on my behalf, to keep the entire proceeds of sale and to claim any Gift Aid* applicable. I undertake to notify you if I cease to be a UK taxpayer."

That should do the trick.

[*FWIW, if you are higher rate taxpayer, you can claim higher rate relief on the gift as well, although you would then need the sale figures from the charity.]