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Gift Aid and Higher Rate Tax
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Shetland
Posted: 21 February 2024 13:25:36(UTC)
#1

Joined: 13/03/2015(UTC)
Posts: 1,244
Can someone please confirm that the following calculation is correct

If I give say £1000 to a charity then they also get the tax I paid on that income so the charity gets £1250. If I am liable for higher rates of tax does the gift aid donation has the effect of increasing the amount that I pay 20% tax on from £37700 to £38250 ?
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Chalky W
Posted: 21 February 2024 13:35:38(UTC)
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Joined: 02/01/2020(UTC)
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Just read this on the gov website -


If you’re a higher-rate taxpayer
You can claim back the difference between the tax you’ve paid on the donation and what the charity got back when you fill in your Self Assessment tax return. It’s the same if you live in Scotland. Do this either:

through your Self Assessment tax return
by contacting HM Revenue and Customs (HMRC) and asking them 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%).
With Payroll Giving, you do not pay the difference between the higher and basic rate of tax on your donation.

https://www.gov.uk/donating-to-charity/gift-aid

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3 users thanked Chalky W for this post.
Shetland on 21/02/2024(UTC), Tim D on 21/02/2024(UTC), Johan De Silva on 19/03/2024(UTC)
Johan De Silva
Posted: 19 March 2024 17:07:33(UTC)
#3

Joined: 22/07/2019(UTC)
Posts: 4,420
If this is the case you can probably include National Trust membership as its Gif Aid applicable!
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Lex Further
Posted: 04 May 2024 18:08:23(UTC)
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When you make a Gift Aid donation, the charity can claim back the basic rate of tax you've already paid on the money you're donating. So, if you donate £1000, the charity can claim an additional £250 from the government through Gift Aid, making the total amount received by the charity £1250. Reach out davo sales tax customer service for more detailed info.
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Johan De Silva on 04/05/2024(UTC)
Newbie
Posted: 04 May 2024 18:21:31(UTC)
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Shetland;297001 wrote:
Can someone please confirm that the following calculation is correct

If I give say £1000 to a charity then they also get the tax I paid on that income so the charity gets £1250. If I am liable for higher rates of tax does the gift aid donation has the effect of increasing the amount that I pay 20% tax on from £37700 to £38250 ?

In a nutshell - Yes
Just make sure that the charity is registered (both with the commission and HMRC)
Also ensure that they claim Gift Aid and you have signed up to say they can use your gift to claim back the tax.
you then get the higher tax rate benefit by your band/threshold increasing by your contribution amount.
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1 user thanked Newbie for this post.
Shetland on 05/05/2024(UTC)
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