Do you pay tax?
Well, who doesn’t? Even your pension is liable for tax if it is over £10,000 a year (£192/week)!
What you may not realise is that donating through Gift Aid means that St Edwards can claim an extra 25p back from HMRC for every £1 you give. This means the tax you have paid can be claimed back by St Edwards directly from HMRC.
It does not cost you any extra, and it does not affect the tax you pay
If you have paid tax it can be claimed back by any charity. For St Edwards this can mean a significant boost to our annual income….for no extra effort from you apart from filling in a form. It could not be easier to get ‘free’ money to boost the church finances. Think of it this way, for every £1000 that St Edwards receives, we have the potential to claim £250 from HMRC. If St Edwards receives £40,000 a year through offerings, this could be as much as £10,000 we can claim every year from HMRC. And to repeat: it costs you nothing, zilch, nada, nowt!
What you need to do
You need to complete a Gift Aid declaration form that includes your name and address. This will allow our Gift Aid co-ordinator (Mandy Collins) to make a claim to HMRC in order to reclaim the tax.
You must give a separate declaration to each charity you want to donate to through Gift Aid. So even if you have already completed a Gift Aid form for some other charity you support, you can still Gift Aid your church contributions.
If you decide to claim Gift Aid now you can include all donations from the last 4 years.
So, if you have been paying tax for all or some of the last four years whilst also making regular contributions to the church we can claim back the tax for that period. For example, if you have been donating £5 a week for the last four years, that is £1040 pounds – St Edwards can claim back £260 – obviously the more you have donated the more tax that could be re-claimed.
Paying enough tax to qualify for Gift Aid
Your donations will qualify as long as they’re not more than 4 times what you have paid in tax in that tax year (6 April to 5 April).
The tax could have been paid on income or capital gains.
You must tell the our Gift-Aid coordinator/treasure if you stop paying enough tax.
Higher rate taxpayers
If you pay tax at a rate of 40% or above, you can claim the difference between the higher and basic rate on your donation. Do this:
- through your Self Assessment tax return
- by asking HM Revenue and Customs (HMRC) to amend your tax code
Example You donate £100 to charity – they claim Gift Aid to make your donation £125. You pay 40% tax so you can personally claim back £25.00 (£125 x 20%).
Tax-efficient giving – what’s not to love about it?
If you have questions, or want more information, speak to Mandy or Bob