“The Church of England parishes collectively receive over £80 million in Gift Aid tax rebatesChurch of England Parish Resources
each year… sufficient to pay 1,600 stipendiary clergy.”
We encourage donors who are taxpayers to complete a Gift Aid form so that churches can recover the basic-rate tax aid on donations. Some online and contactless giving platforms can collect and report Gift Aid declarations for you, making your claim much simpler. The Parish Giving Scheme will automatically remit the Gift Aid on donations to your church monthly – it is the easiest way to maximise your Gift Aid claim.
Gift Aid Small Donations Scheme (GASDS)
Charities can also claim a Gift Aid-like repayment on up to £8,000 of small cash donations each tax year. The maximum amount which be claimed is £2,000. Eligible donations must be £30 or less, given via contactless or cash.
To be eligible for GASDS, you must be able to supply evidence of:
- small donations being deposited at a bank or post office branch in the UK
- when donations were collected and how (cash or contactless)
- where donations were given – you must be able to supply evidence that collections were taken at gatherings of at least 10 people.
For regular givers who donate cash to your parish, make sure you have an envelope register as evidence for GASDS. This should identify regular planned giving in envelopes not covered by a Gift Aid declaration. These can also be included in the scheme provided the donation given in a particular week is in cash and is £30 or less.
Parish Resources has detailed advice on how best to apply for GASDS, depending on whether your parish is single- or multi-church.
In respect of GASDS, guidance on the eligibility for donations for inclusion in this scheme is clear in stating that claims can only be made on cash donations of £30 or less; and contactless card donations of £30 or less collected on or after 6 April 2019.
The decision over what constitutes an eligible donation is one for the church/charity to make for themselves, rather than for HMRC, but the conditions for something to be considered a ‘small donation’ are clearly set out in legislation. Where it is the case, for example, of separate donations being given in a single envelope, then if the church/charity official is happy these are clearly separate ‘small donations’ (and clearly stated as such) then they will be eligible for GASDS, as is the case where separate envelopes are used”.
Churches could also help to make it easier to distinguish such gifts by providing separate collecting plates/donation receptacles reserved for saved-up donations when the lockdown restrictions are eased
Gift Aid practice
Her Majesty’s Revenue and Customs (HMRC) requires churches to have an audit trail of all donations made.
In 2016, the requirements for declarations changed. The main change is to make clear that it is the donor’s responsibility to pay any difference between the amount claimed in Gift Aid for all charities to which they have donated in a tax year and the amount paid in income tax or capital gains tax. Model Gift Aid declarations, which you can personalise for your church, are available for single donations and multiple donations.
You can collect declarations via telephone and e-mail too. For advice on best practice see this guide.
There are step by step guides to claiming Gift Aid, from basic principles to aggregate claims and other questions on Parish Resources.
For regular givers who donate cash to your parish, make sure you have an envelope register so that you can apply to GASDS (valid for gifts of up to £30).
We put together some of our Top tips for claiming Gift Aid, which you can read in a recent blog post.