Stories that UK celebrities have been exploiting tax reliefs on charity donations may threaten the future of share-giving, charity accountants have warned.
The Sunday Times claimed that celebrities were involved in a tax ploy previously reported in Third Sector (September 27). Shares are donated to charities at artificially high prices, enabling the donor to claim an inflated tax rebate from HM Revenue & Customs. The charity can be left with worthless shares.
The Sunday Times said Angus Deayton and David Baddiel would qualify for rebates of £144,000 and £160,000 respectively.
"This sort of publicity has a bad effect on the share-giving scheme, which is an under-utilised way of donating," said Nick Brooks of accountants Kingston Smith. "This is a shame because share-giving can be very beneficial when it is done properly."
Mike Warburton, senior tax partner at Grant Thornton, said HM Revenue & Customs were concerned that charity exemptions were being abused: "That doesn't make it illegal and I don't see why the charity shouldn't accept share gifts."