The Small Charitable Donations Bill
- Download the report on responses to the Public Reading Stage (PDF, 401kb)
- Memorandum submitted by HM Treasury and HM Revenue and Customs
The Small Charitable Donations Bill will introduce the Gift Aid Small Donations Scheme (GASDS) – a new scheme that will enable charities and community amateur sports clubs (CASCs) to claim Gift Aid style payments on the small donations they receive where it is difficult to get a Gift Aid declaration.
Charities and CASCs will be able to claim a top up payment on small donations of up to £20, up to a total of £5,000 of small donations per year, so qualifying charities and CASCs will be able to claim up to £1,250 in payments each year. It is estimated that this scheme, announced at Budget 2011, will lead to an extra £100 million a year in Government funding for charities by 2015-16. The scheme will commence in April 2013.
NCVO Policy team, NCVO: NCVO strongly objects to this ‘matching’ requirement in the Small Charitable Donations Bill.
We understand that HMRC wish to reduce fraud risks by requiring organisations to have a track record of successful Gift Aid claims. However, Clause 1(4) proposes to further restrict the level of Small Donations claims that can be made by a charity on the basis of a 2-1 match with their Gift Aid claims.
This means that in order to claim the maximum amount under the GASDS (up to £1250 on maximum of £5000 small donations), a charity would need to have made Gift Aid claims of at least £625. It is unclear how requiring charities to have claimed a certain monetary value through Gift Aid – in addition to having a good track record - would improve the scheme or reduce fraud risks.
As it stands, Clause 1(4) unnecessarily complicates the Scheme and will disadvantage some charities. There will be charities that have not raised enough through Gift Aid to entitle them to claim the full amount under the new Small Donations Scheme. These charities may not often get the types or size of donations where they can realistically collect Gift Aid declarations – for example, if they use a collecting tin. These charities could benefit greatly from this new Scheme, but could find themselves at a disadvantage due to the matching ratio.
NCVO would recommend dropping this clause.
125 days ago Report this comment