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"giving to charities"

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Chatting to a friend today, and he raised the subject of 'charitable giving'.

 

I understand that, if you donate to a charity, you can claim it against tax on your tax return.

 

So, when CART is fully implemented as a charity, can we claim our license fee and mooring fees (if paid to Cart) against tax?

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Chatting to a friend today, and he raised the subject of 'charitable giving'.

 

I understand that, if you donate to a charity, you can claim it against tax on your tax return.

 

So, when CART is fully implemented as a charity, can we claim our license fee and mooring fees (if paid to Cart) against tax?

Not sure if PAYE can do so DOR? If so do you have any more info, because it is something I need to look into. I know as a taxpayer one can "gift aid" a charity donation, so the charity can reclaim any taxes that are paid to the value of the donation (I havent explained that very well.) We do this all the time.

 

Good point re. C&RT.

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Chatting to a friend today, and he raised the subject of 'charitable giving'.

 

I understand that, if you donate to a charity, you can claim it against tax on your tax return.

 

So, when CART is fully implemented as a charity, can we claim our license fee and mooring fees (if paid to Cart) against tax?

 

Doubt it as licence and mooring fees are just that - fees. ie not donations

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I understood that for a museum or charity to be able to claim an admission fee as a gift aidable donation the payment had to be greater than the admission fee itself - usually by at least 10%

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I understood that for a museum or charity to be able to claim an admission fee as a gift aidable donation the payment had to be greater than the admission fee itself - usually by at least 10%

 

You'll be pleased to know that there is no requirement whatsoever for the donation to be greater than the normal rate in order to qualify for Gift Aid

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You'll be pleased to know that there is no requirement whatsoever for the donation to be greater than the normal rate in order to qualify for Gift Aid

 

Your licence fee is not a donation, it's a purchase. If you care to make a donation then the charity could claim the tax you've paid by PAYE under Gift Aid. Similarly if you fill in a Tax Return you can claim tax exemption for charitable donations (not purchases) up to £50,000 if the government doesn't change its mind.

Edited by grahame r

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You'll be pleased to know that there is no requirement whatsoever for the donation to be greater than the normal rate in order to qualify for Gift Aid

Not according to this My link

Edited by Thorfast

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I run a marina which is owned by a charitable trust, the structure we have to operate under is that the trust owns a trading subsidiary company which operates the moorings and other commercial activities, any surplus is gift aided to the charity which delivers outdoor education activities for young people. This was set up in this way as providing moorings is deemed to be a trading not charitable activity by the charity commission. I do not know how CART is structured but I will happily take a bet of anyone who wants to state that HMRC will accept a license fee as a tax deductable donation!

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When to the Waterways Museum al Ellesmere Port a couple of months ago. Same thing, they asked if I would like to do gift aid for the (standard) admission fee, and in return get 12 months free entry. No additional donations or anything involved, so on the face of it its not clear to me when you can and can not do gift aid.

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I have no idea if and how it would make a difference but I know with some entrance fees (I am thinking about The Black Country Museum among others) if you are prepared to "gift aid" your admission fee then you get free entry for the next 12 month period. Now this is hyped up at the entrance top encourage everyone who can to sign for gift aid. In reality there are not very many people who can make use of a second entry in 12 months and when they do I expect they spend the money they have saved on buying stuff once inside.

 

It is worth remembering when adding gift aid to any donations you make that the total amount your give via gift aid cannot exceed the total amount you have paid in tax for the given year. I know some of you will be aghast at the thought you could possibly exhaust the amount of tax you pay in gift aid but for those on a low income and people like pensioners who perhaps only pay a small amount of tax on savings etc it can catch you out. In the event of you signing a gift aid form for more than the amount you have paid in tax it means The Inland Revenue will then seek to reclaim this extra cost from the taxpayer which has caught a few people out.

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Similarly if you fill in a Tax Return you can claim tax exemption for charitable donations (not purchases) up to £50,000 if the government doesn't change its mind.

 

This is the cap that hasn't come in yet (it needs legislation). And it's not just £50,000 -- it's £50,000 or a quarter of your earnings, whichever is greater. So if you earn more than £200,000 the cap goes up accordingly.

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Not sure if PAYE can do so DOR?

 

If you pay Standard rate tax then the receiving charity claims the value of the tax on the donation. You do nothing, and get nowt. If you pay higher rate tax then the receiving charity claims the value of the tax on the donation at standard rate and you can claim the donation in your SA Tax return. You then get the difference between standard rate and higher rate back ( if it is not offset against tax underpaid elsewhere on your return).

 

I think the same principle applies if you pay the top rate, but I'm not sure. I ain't a naccountant.

 

I would sincerely hope that CART are looking at how they work Gift Aid to our benefit, particularly on moorings and licences.

 

N

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In the event of you signing a gift aid form for more than the amount you have paid in tax it means The Inland Revenue will then seek to reclaim this extra cost from the taxpayer which has caught a few people out.

 

Has this ever really happened?

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Has this ever really happened?

 

Yes it has.

 

I was reminded recently about it because now I no longer work I could have had a problem as I have a direct debit in force for a regular donation. It was simple enough for me to deal with - I got married to a taxpayer! :lol:

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Do not confuse fees paid for services provided by the commercial element of the trust, i.e. the licence that gives you right to use the waterways and the payment for moorings if appropriate, with donations.

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what stops a fat cat from setting up a 'charity' that only benefits him or his family?

Why do you think the government has acted?

 

And to answer the other poster. Fat cats have been setting up foreign charities outside the scope of the Charity Commissioners.

 

Why the government didn't just apply the new rule to foreign charities is another question. Perhaps EU rules prevent such discrimination.

 

George ex nb Alton retired

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Why not make all charitable donation follow the "Gift Aid" principle. The donor doesn't claim it on against their tax, the charity claims it from the Government instead. Wouldn't that stop the Fat Cats from having a loophole, without hindering the genuine philanthropist.

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Why not make all charitable donation follow the "Gift Aid" principle. The donor doesn't claim it on against their tax, the charity claims it from the Government instead. Wouldn't that stop the Fat Cats from having a loophole, without hindering the genuine philanthropist.

 

I think they do - but with GA the charity only gets the fixed rate (currently appoximately 25p in the pound) irrespective of the individual's tax liability. Higher rate tax payers can, therefore, claim exemption for the difference between the amount claimed by the charity and the rate that the taxpayer is liable for. It is a bit complicated because, as I understand it, the taxpayer needs to keep documentary evidence of all charitable giving approved by HMRC and this can then be set against the taxpayer's personal allowance. Also, HMRC can also send any subsequent tax rebate to the individual's chosen charity.

 

I think that the real reason for the change is because some unscrupulous 'benefactors' create charities for their own benefit - I once knew someone who had a heated swimming pool in the grounds of her mansion that was 'officially' owned by a specially created charity for young swimmers - the only young swimmers ever granted admission being her own family! Similarly, I know several people who have extensive miniature railways or vintage car collections that are registered charities and apart from having the occasional open day, they are very private concerns.

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I'm wondering how on earth Chatsworth qualifies for Gift Aid!

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I'm wondering how on earth Chatsworth qualifies for Gift Aid!

 

Because the house is now owned by a trust, and the family pay rent to the trust for their private apartments.

 

The trust exists to preserve the estate for the public to come and see it.

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Well, this year to date I have been asked to sign the Gift Aid authorisation for The Deep (Hull Museum) and Chatsworth House for purely the 'entrance fee' levels

 

 

There are two ways in which admission fees qualify for GA;

 

1) A donation of at least 10% over the admission fee.

2) A donation that secures free or cut-price access for a 12 month period.

 

Thus, a charity can gift aid the normal admission price, provided they then allow you free or reduced price admission for the rest of the year

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