TaxCorporate TaxCharities to take £70m hit from Budget tax changes

Charities to take £70m hit from Budget tax changes

A £70m loss for charities looms after Budget income tax changes

The charity sector could lose out on as much as £70m following changes to the
income tax thresholds in the Budget.

The Treasury
will give 25p back to charities for every pound donated by a UK taxpayer,
rather than 28p.

A £1 donation is treated as the net after tax, so £1.28 minus 22% equals £1.
So the 2p income tax cut loses charities 3p for every pound donated.

Charities’ Tax Reform
Group
told the FT that the Treasury
should offset the change by reducing the sector’s VAT bill.

Further reading:

Charities vulnerable to ‘bond washing’
dodge

Charity tax probes create late filing
chaos

Charity tax schemes ‘cost UK £100m’

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