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Charities will be able to claim top-up payments on up to £5,000 of small donations without needing Gift Aid declarations, under changes in a Bill before Parliament today.

The Small Charitable Donations Bill aims to enable charities and community amateur sports clubs (CASCs) to claim a Gift Aid-style payment on small donations where it is difficult to get a Gift Aid declaration. It will be known as the Gift Aid Small Donations Scheme (GASDS).

Charities and CASCs will be able to claim a top-up payment on small donations of up to £20. Qualifying charities and CASCs will be able to claim up to £1,250 in repayment.

Chloe Smith, Economic Secretary to the Treasury, said:

“The Government is committed to encouraging charitable giving and building a more socially conscious society. Key to this is building a stronger culture of giving. The proposals in this Bill are part of that drive.

“The scheme will particularly help small charities that rely on bucket collections, where it is impractical to get the paperwork required under Gift Aid. They will now be able to claim a Gift Aid-style payment on small donations without the need to collect donors’ details.

“The Gift Aid Small Donations Scheme will boost the income of charities, unlocking around £100m more funding for charities a year by 2015-16.”

Charities will be able to claim the Gift Aid-style top-up payments from HM Revenue and Customs (HMRC) from April 2013.
Notes for editors 1. The Small Charitable Donations Bill 2012-13 can be seen here.
2. The new scheme is a spending measure, unlike Gift Aid which is a tax relief, as there is no link between the donor’s tax record and the payment to the charity.
3. Charities must have a three-year record of successfully claiming Gift Aid and continue to make Gift Aid claims to qualify. This is to reduce the risk of fraud.
4. A summary of responses to the Gift Aid Small Donations Scheme consultation which ended on 25 May is available here.
5. HMRC will publish draft guidance for the scheme for consultation in the autumn.
6. Follow HMRC on Twitter @HMRCgovuk

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