A temporary change allowing charities to claim Gift Aid on tickets sold to events that are cancelled if supporters decide against asking for refunds has been made permanent, the Charity Tax Group has said.
In April, HM Revenue & Customs announced a temporary change to the rules as thousands of charities faced having to refund customers due to attend events cancelled because of the Covid-19 pandemic.
The CTG and Arts Council England were among the organisations that had been campaigning for the measure to be made permanent.
It is understood that the change was announced at HM Revenue & Customs’ Charity Tax Forum meeting earlier this week, with formal guidance confirming the move due to follow.
Very pleased to receive confirmation from @HMRCgovuk this week that this #GiftAid change will become permanent ie. not just a COVID concession but any cancelled event or loan waiver with suitable evidence. HMRC guidance to follow @ace_national https://t.co/ehrA0uinOX— Charity Tax Group (@CharityTaxGroup) January 19, 2021
It is not yet clear exactly what form the final guidance will take, but it is expected to be published soon.
Charities will need to have an audit trail showing the individual agreed to treating the refund as a donation, that the donor did not receive a benefit as a result of their donation, and they completed a Gift Aid declaration.
The CTG said the move was a “very welcome development”, particularly as the waivers of loans to charities could be counted as donations to which Gift Aid could apply, providing the agreement to waive the loan was “clear and irrecoverable”.