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Feeling Charitable?
There is a new box on this year's income tax return (they have found a small extra space for it). You can now tell the Revenue to give some or all of any tax refund that you are due directly to a charity, and the charity can then claim 'Gift Aid' relief on the payment.
It may be simpler for everyone if you just send a cheque to the charity with a Gift Aid declaration, and keep your giving separate from filing your tax return - there is no particular reason to do the two things together. But charities will start to advertise the idea, and some people may find it a relatively painless way to give - if the money goes directly from the Revenue to the charity, it will not seem to cost anything.
If you want to take advantage of this, the charity must have registered with the Revenue to be part of the scheme, and it will have to give you a reference number. This goes on the return, together with a statement of the amount you want to give. It's probably safer to put a figure on it - in case 'all my refund' turns out to be much more than you expected!
There are some possible problems. The Revenue are sure that they won't pay the wrong charity because of security features in the reference numbers, but if they do, they promise to sort it out. But if they pay a refund to charity, and then enquire into your affairs and find the refund wasn't due, they will collect the money from you - not from the charity. So the gift is final once it's been made.
| The rules, and a number of related issues, are discussed in detail in the Revenue's Working Together bulletin (issue 17) which can be accessed through the Revenue's website (www.inlandrevenue.gov.uk). |
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