Money tip #2 – Don’t give money to charity collectors
…if you are a UK income tax payer.
Instead make a contribution to the very same charity via the Gift Aid Scheme. Basically, if you contact the charity directly (by phone or online) and ask to make a donation they will ask you to fill in a simple form which enables them to reclaim basic rate tax, from HMRC, on the gross value of your gift.
So for every £1 you donate to the charity they can claim an additional 25p from HMRC! So boosting your donation by 20%. If you were to simply put £1 into a street collector’s tin then there is no way for the charity to reclaim the basic rate tax as it is an anonymous contribution.
In addition, if you are a high rate tax payer you can also reclaim 25p for every £1 of your contribution via your Self Assessment tax return.
So the charity wins, you win and the tax man loses!!! (who said the world is a bad place?)
Full details on Gift Aid Scheme are given on the directgov website:
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