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Toybox explains: What is Gift Aid?

Updates • Mar 2022

If you’ve ever been in touch with the Toybox office, the chances are you will have spoken to Jenny. Jenny has been working for Toybox for almost 19 years now (yes you read that right!) and is our Income and Database Administrator who is responsible for overseeing all of our supporter enquiries and questions. As if that wasn’t enough, she is also our Gift Aid expert! Here, she shares some guidance on what exactly Gift Aid is and how it can make your donations to charity go even further.

What is a Gift Aid declaration?

If you’ve ever given a donation to a charity, or paid entrance to a cathedral or a stately home, you’ll have been asked ‘Can we claim Gift Aid’ on that? Maybe you answered ‘Yes’, or ‘No’, or maybe you just avoided the question because you didn’t really understand what you were being asked!

If you are in that last category, this blog is especially for you. But it’s also for everyone who wants to make sure that their gifts are having the biggest impact possible.

So, first of all, what is Gift Aid? It is a scheme that was introduced in 2000, and it allows charities like Toybox to claim extra money from HMRC. As long as your gift is your own money, and you pay at least the basic rate of tax, then Toybox can claim 25p from HMRC for every pound you have given. That means that your gift of £1 is worth £1.25 to us, without you having to pay any more.

Not every kind of tax counts – it has to be Income and/or Capital Gains Tax and you must pay more than the amount of Gift Aid claimed on all your donations in that tax year. If you’re not sure it’s probably better to say ‘no’ as it would be your responsibility to pay the difference if you end up allowing too much Gift Aid to be claimed. That’s particularly something to watch out for if you give to several different charities.

How to Gift Aid donations

So, if you decide that you do pay enough tax to allow Gift Aid to be claimed in your name, what do you need to do next? There are several different ways you can sign up to Gift Aid. Here at Toybox, it can be done via our website when you make a donation, over the phone, by email or by letter. At the very least we would need your first name (or initial), surname, the first line of your address and your postcode.

• If you sign a form or use the website, there is specific wording available on the form.

• If you make a declaration over the phone then we will send you out a confirmation letter. Please read it through and check you are happy with it.

• If you let us know by email, then give your name and address, and the following statement: ‘I want to Gift Aid my current donation and any donations I make in the future or have made in the past 4 years to Toybox. I am a UK taxpayer and understand that if I pay less Income Tax and/or Capital Gains Tax than the amount of Gift Aid claimed on all my donations in that tax year it is my responsibility to pay any difference.

You’ll see from the above statement that the declaration is three-fold - this donation, any previous donations and any future donations. That’s because a charity can claim Gift Aid on donations that have been made up to four years ago. However, if you have only just recently become a tax payer, make sure you tell us so we only start claiming Gift Aid when you ask us to.

How does Gift Aid work?

A few things to be aware of:

  1. Gift Aid declarations can only be made in the name of one person so if we have sent a letter addressed to both you and your partner, please indicate which of you is the tax payer.
  2. If you are not a tax payer, but your partner is, we can claim Gift Aid on their donations and donations from a joint account, but not from your own individual account.
  3. If you have collected money on behalf of a church or group then we cannot claim the Gift Aid in your name. However, we can send you Gift Aid forms for other people to complete. Please mark these with the amount they have given and send them to us with the group’s donation.
  4. If you are doing a sponsored event then we can send you a sponsorship form that allows people to sign up for Gift Aid when they make their pledge of money.
  5. If you give using charity vouchers, e.g. through CAF or Stewardship then we cannot claim the Gift Aid.
  6. Similarly if you give via Just Giving, then we cannot claim the Gift Aid. You can, however, make a Gift Aid declaration on the Just Giving website and we receive the Gift Aid directly from them. If you need a tax certificate we send these out in May/June each year. These show the amount you have given to Toybox in the past tax year (6th April to 5th April) and the amount of Gift Aid we have claimed in your name.

If at any point you stop paying enough tax, and need to cancel your Gift Aid declaration please let us know as soon as possible as Toybox claims Gift Aid from HMRC on a monthly basis.

Gift Aid and tax

One last thing, if you pay Income Tax at the higher or additional rate, then you can receive additional tax relief. In order to do this you must include all your Gift Aid donations on your Self-Assessment tax return or ask HM Revenue and Customs to adjust your tax code.

So what next? If you still have any questions, or you would like us to send you a Gift Aid form, please contact us on 01908 360050. Alternatively you can email [email protected] and we’d be glad to help you.

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