How could Gift Aid be improved and generate more income for charities?
The future for individual giving in the UK looks uncertain. With some data management rules changing, charities may not be able to communicate with as many of their supporters as they do now, and this could seriously affect the Gift Aid scheme.
In this free report, Joe Saxton details why he thinks Gift Aid is not as widely taken up as it could be and explores how it could be restructured to increase income for charities and compensate for income falls due to changing data protection regulation.
Scroll down to download this report, and please share your thoughts on the issue in the comments section below the download form.
Thanks
Thanks
Sorry Joe but I must disagree
Sorry Joe but I must disagree with you and this is not just because I have a vested interest . Yes Gift Aid is difficult, and yes HMRC would try and make it as difficult and bureaucratic as possible, but, as you say, this is HMRC and their job is to collect tax, not give it away. But at the end of the day it is free money and if done correctly it is giving a guaranteed 25% increase in the value of a donation. Charities should therefore expect to jump through a few hoops to get that - it will not just come to them on a plate. Clearly making changes will take a lot of lobbying and time, during which a lot of Gift Aid is being lost - an estimated £800 million a year. So whilst I agree that changes can come about to simplify the requirements of Gift Aid, I would also like to see the whole of the sector doing far more to train and inform charities on correct Gift Aid operation. And if they do not feel able or comfortable to do it in house, then they can do what they do with many of their other functions such as fundraising, PR, fulfillment, accounting etc., etc. and pass it over to third parties. At the end of the day, it is all about getting the money, now.
Hi Joe
Hi Joe
An interesting article but again I am not sure that I agree with your solutions. These may simplify things a little especially for those larger charities that are already claiming gift aid but for smaller charities gift aid is not even on the radar. Most small charities encourage people to use online giving sites as the most tax efficient way of claiming but these take a fee and are no good for small donations such as GASDS can help with. For small charities, a scheme by which say the first £5000 raised from cash, cheques or text donations was assumed to be eligible and therefore received gift aid would be the most useful.
There is a growing issue between the big and very small charities with research showing that smaller organisations have suffered the most as government funding dries up, as contract sizes grow and grant funding reduces. Any help that can be given to these small organisations would be incredibly useful, but this needs to be simple and straightforward which is not generally the HMRC way.
Gift Aid can quite often be
Gift Aid can quite often be the fifth or even fourth largest income stream for a charity, yet most don't even employ one member of staff to deal with it. It's often delegated to finance teams who (obviously) take quite a finance view of it.
Gift Aid is another form of charitable giving in my book and should be treated as such. We should be trying to inspire people to give in this way and we should be making it another type of fundraising ask, even part of our supporter journeys. But most donation forms simply "tag it on the bottom" like a legal T&Cs addition.
If you have 50% Gift Aid take up amongst your donors then employ someone to get this up to 60%, they'll make their money back in year one without a doubt. We plough millions into equipping fundraisers with the skills to "inspire" people to donate, yet ALL Gift Aid training involves explaining the legal aspects of Gift Aid to fundraisers....boring....and for a fundraisers role, totally useless. The finance team should deal with the legal aspects of Gift Aid, fundraisers should inspire people to give a Gift Aid declaration in the first place.
We should be training our fundraisers on how to inspire people to want to sign the Gift Aid declaration not boring and scaring the hell out of them when it comes to Gift Aid.
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