With 61% of the British population having donated money to charity in the last 12 months we’re a very generous nation.
For many people, donating to charity will mean dropping some coins into a bucket, texting £10 to their favourite charity or perhaps setting up a direct debit – but there are more ways to donate to charity. Payroll Giving, for example, is one of the easiest ways to make regular donations to charitable organisations.
The scheme needs to be set up and administered by your employer. It is up to the individual employees to which charity they wish to donate, allowing those interested in the scheme to pick their favourite charity.
The scheme allows you to donate money directly from your gross salary so that you receive the appropriate amount of tax relief on any donations made. This means that you can donate more to your chosen charity: a £20 donation from a higher rate taxpayer will only cost £12, as there will be an £8 tax saving.
As you will have already received tax relief on your donation the charity won’t be able to claim Gift Aid, saving them time on administration. This also saves higher rate taxpayers the need to fill in the Gift Aid section of their tax return.
There are some employers out there who offer to match any donations made through the Payroll Giving scheme, meaning even more cash for your favourite charity! As an employer, this could help to improve your corporate social responsibility policy and also help to retain staff.
If you would like any more information about the tax relief available through charitable giving or are interested in setting up a Payroll Giving scheme please don’t hesitate to contact me.