Brown to simplify Gift Aid

Chancellor Gordon Brown has said he wants to make it easier for charities to claim Gift Aid on telephone donations, following an unprecedented number telephone pledges since the tsunami appeal.

Gift Aid on telephone donations can now be claimed without needing to obtain a written declaration from donors.

The Treasury estimates that the rule change, due to come into effect on 1 November, is worth at least £1m to British charities.

Many experts in the voluntary sector, however, put the figure closer to £10m, as many smaller charities are deterred from claiming Gift Aid because of the
extra costs of collecting it.

But top 10 firm Tenon has criticised the chancellor for not allowing the changes to have immediate effect, as the Pakistan earthquake has stimulated a huge surge in charitable giving.

Tenon director of tax Andrew Hubbard said he would like to see Brown adopt a bolder stance. ‘Charities should be able to claim tax relief on all donations, whether or not the donor has paid any tax that year,’ he said.

Nick Kavanagh, finance director of Save the Children and chairman of the Charity Tax Reform Group, said it would only benefit the charities that do big telephone appeals.

‘But it does show that the government is trying to help and we are trying to persuade them to show the same creativity and support on VAT,’ Kavanagh added.

Gaynor Coley, former finance director and now managing director of the Eden Project, said: 'Gift Aid at Eden has put the concept of charitable giving in front of millions of visitors. It’s good to hear that the current proposals from the Treasury allow forward-thinking charities to continue to benefit.

'The annual membership element suits the relationship we have always wanted to develop with our visitors, and unlike reports of donation fatigue elsewhere, our experience is that they appear increasingly willing to sign up when they can see the direct consequences of their donation to the Trust first hand.'