Charities miss out on 215 million through donor's tax-inefficiency
"Give and let Hector give too!" says IFA Promotion
Britain's charities are missing out on a 215 million bonanza this year because consumers are not making the best use of tax-efficient ways of donating, says IFA Promotion, the organization promoting the benefits of independent financial advice.
The figures, revealed as part of IFA Promotion's TaxAction 2000 campaign, show that of the 445.5 billion donated by individuals to charity last year, just 4.6 billion was donated via Covenant, Gift Aid and Give As You Earn; the three methods of tax-efficient giving.
Over 25 million Britons (55% of the adult population) gave to charity in 1998/9. Of these, around 14.5 million are taxpayers, yet just 400,000 employees donated a mere 29 million via the Give As You Earn scheme. IFA Promotion's conservative calculations reveal that if just one in five employees who donate more than 5 per year to charity did so by means of tax-efficient payroll giving, charities would be in for an additional annual windfall of 215 million.
Covenants to charities must be made for at least four years but can be for any amount. One-off donations over 250 can be made via Gift Aid and regular deductions from salaries can be made by those whose employers operate a Payroll Giving scheme (Give As You Earn) and can range from 2.50 a month to 900 a year. A tax-efficient donation of 100 by a basic rate taxpayer will be worth 133 to a charity once it has reclaimed the tax.
In addition, throughout this year and next, the Government is running a Millennium Gift Aid scheme which has no minimum limit and no upper cap for tax-free charitable donations.
David Elms of IFA Promotion commented: "Whilst people will always want to slip a few coins into a collecting tin - particularly in the approach to Christmas - their chosen charities will benefit far more by donations made tax-efficiently. We are urging people to give what they can but want them to ensure the taxman does the same on their behalf!"
He concluded, "It's easy to arrange and you don't have to give a large amount. The message is simple - talking to an independent financial adviser can help you make your donations go further for the charity of your choice."
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For further information, please contact:
| David Elms | or | Richard Winder / |
| Marketing Director | Shellie Wells | |
| Independent Financial Adviser | Lansons Communications | |
| Promotion | Tel: 020 7490 8828 | |
| Tel: 020 7833 3131 |
1. Independent Financial Adviser Promotion
Independent Financial Adviser Promotion Ltd. was established in 1989 to promote the value and accessibility of independent financial advice to the public. It represents over 9,000 registered individual independent financial advisers across the UK and is sponsored by 34 leading financial institutions.
2. Independent Financial Adviser Promotion. s sponsorsAberdeen Asset Unit Trust Managers | PPP Lifetime Care Plc |
Barclays Global Investors Funds | Prudential Intermediary Division |
BUPA | Scottish Amicable Life Plc |
CGU Life | Scottish Equitable Plc |
Clerical Medical Investment Group | Scottish Life Assurance Company |
Dresdner RCM Funds (UK) Ltd. | Scottish Mutual Assurance Plc |
Eagle Star | Scottish Provident Institution |
Family Assurance Society | Scottish Widows' Fund & Life Assurance Society |
Friends Provident | Standard Life Assurance Company |
Hill Samuel Asset Management Group | Sun Life |
INVESCO Fund Managers Ltd | Swiss Life (UK) plc |
Investec Guinness Flight | The Canada Life Assurance Company |
Legal & General | The Skandia Group of Companies |
Mercury Asset Management | Tunbridge Wells Equitable Friendly Society |
National Mutual | UNUM Ltd |
National Savings | Winterthur Life UK Ltd |
Norwich Union Life Insurance Company Ltd | Zurich Life Assurance Company |
NPI |