Gift aid is an easy way to help your charity maximise the value of donations from UK taxpayers.
You can claim back basic rate tax from HMRC on Gift Aid donations. You can also claim back tax deducted from other income such as bank or building society interest or tax deducted from income arising on gifts left to your charity in a will.
This means that for every £1 donated, you can claim an extra 25 pence.
You don't have to register to claim gift aid but a charity must be recognised by HMRC as a charity for tax purposes before they will accept a gift aid claim. Recognition by HMRC as a charity is a separate process from registering with the Charity Commission as a charity.
Information you need from donors
In 2012 HMRC published updated guidance on gift aid declarations and provided new model declarations. The new model declaration includes the words
I am a UK taxpayer and understand that if I pay less Income Tax and/or Capital Gains Tax than the amount of Gift Aid claimed on all my donations in that tax year it is my responsibility to pay any difference.
This is a significant change from the existing wording so please ensure that you incorporate it on all gift aid declarations and envelopes.
HMRC: Gift Aid: the basics