Charity relief is to be protected against abuse with immediate effect as part
of the chancellor’s crackdown on abusive tax avoidance practices.
Gordon Brown confirmed measures restricting the scope for people to donate
large sums of money, then ‘withdraw’ the money for private use once tax relief
has been granted.
Restrictions on relief where charitable funds are used for non-charitable
purposes were also announced.
In a further clampdown on tax avoidance, Brown announced that from 1 April,
rules that restrict the benefits a company can receive in return for charitable
donations will be extended to all companies.
Ernese Skinner, policy and campaigns’ director of the Charity Finance
Directors’ Group, said: ‘We are strongly supportive of it. The government has
been keen to protect tax relief and has been gradually looking at abusive tax
Meanwhile, the National Council for Voluntary Organisations welcomed a new
Office of Third Sector Finance to be based in the Treasury.
Stuart Etherington, chief executive of NCVO, said: ‘This demonstrates the
government’s commitment to the voluntary and community sector and acknowledges
the role our sector plays.’
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