As fears grow that the taxman will put a stop to valuable tax breaks, a large majority of financial directors lend their support to the cause.
Finance directors across the UK have thrown their weight behind charities in their struggle against the Treasury over the use of ‘gift aid’ tax breaks.
More than 70% believe charities, like the Eden Project in Cornwall, should be allowed to sell day memberships for entry to venues so the gift aid arrangements can be used, according to this weeks Accountancy Age/Reed Big Question Survey.
In recent weeks the Inland Revenue has made it clear that gift aid should not be used in this way, prompting fears that millions of pounds could be lost as charities are forced to alter their entry fees.
But FDs are backing the charities.
‘I’m sure that the ability of the Eden Project to claim tax relief on day admissions has helped them in the development of this worthwhile project.
I don’t see this as any different to making a donation to charity,’ said Bob Randall of Wicks and Wilson.
‘If it’s a charity then why should the government be so mean,’ Paul Tonks of Hill McGlynn said.
The Eden Project believes it received the backing of the Revenue for its gift aid scheme in 2002 – but is now being told it has to be stopped.
In this week’s Accountancy Age the centre’s development director Gaynor Coley writes: ‘The government wanted to be seen to be doing something for charities, but was shocked when we got off our backsides and seized the opportunity.’
Coley also has the backing of charity finance experts.
Nick Brooks of Kingston Smith said: ‘Bearing in mind the government’s desire and considerable financial investment to encourage new donations, it seems quite disingenuous to try and stop a genuine method of increasing charitable income.’
Some FDs were not so sympathetic. Simon Payne, FD at CDS, said: ‘The scheme should not be used so that charities can avoid paying tax on trading activities that commercial entities would otherwise pay tax on.’
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