Important changes for charities to note

THERE have been changes over the last year regarding the administration of charities, and there are some significant areas to note.

Gift Aid Small Donations Scheme:

Charities and community amateur sports clubs (CASC) may be able to claim top-up payments from HMRC on small cash donations of £20 or less under the scheme.

The scheme may allow the charity to recover tax although no Gift Aid declaration has been made.

The new scheme only applies to donations made in cash, making it particularly pertinent to those who operate collection boxes or bucket collections. Cheques and bank transfers are not eligible.

Various qualifying criteria must be satisfied by the organisation for the top-ups to be claimed.

Charity shops - new guidance released:

HMRC has introduced new rules and guidance for charity shops obtaining Gift Aid on the sale of donated goods. In an effort to simplify the rules, individuals donating goods to charity shops can now make a one-off Gift Aid declaration covering sales of items worth up to £1,000 a year.

Previously, a charity needed to write to a donor to inform them regarding the proceeds from each sale.

Where the goods are sold by a charity operating the shop directly, up to £100 of sale proceeds can be authorised for Gift Aid.

Charities Online:

Charities Online is a new service, introduced by HMRC, which allows Gift Aid repayments to be claimed online.

It is hoped that the system will speed up and simplify the process of making a repayment claim, saving valuable time for charities and CASCs.

There are many complex accounting and reporting requirements governing charities and not-for-profit organisations. Contact Gill Adamson for more information.