Charity coalition calls for temporary rise in Gift Aid rate

The alliance, led by CAF, the IoF, the Charity Finance Group and the Charity Tax Group, plus a number of charities, says this could boost sector finances by £450m

A coalition of major charities and umbrella bodies has urged the government to temporarily increase the rate of Gift Aid not-for-profit organisations can claim in a bid to provide a £450m boost to the sector’s finances. 

The group is asking the government to increase the effective amount of Gift Aid that charities receive on eligible donations from 25 per cent to 33 per cent for the next two years, in a move that would help alleviate the shortfall many charities are facing because of the coronavirus outbreak.

The organisations estimate that the increase would be worth an additional £450m to the sector over the next two years. 

The coalition is being led by the Charities Aid Foundation, the Institute of Fundraising, the Charity Finance Group and the Charity Tax Group, and includes support from major charities such as Cancer Research UK and the British Heart Foundation

The organisations estimate that the move would be cost-neutral to the public purse because the cancellation of many fundraising events in the midst of the pandemic will lead to fewer Gift Aid claims being made. 

Gift Aid claimed by UK charities reached a record high of £1.35bn in the year to the end of March 2019.

Sir John Low, chief executive of the Charities Aid Foundation, said the move would be a “straightforward, quick and tangible way to help charities at this most challenging time in their history”. 

Caron Bradshaw, chief executive of the Charity Finance Group, said: “The cancelled fundraising events across the country mean that Gift Aid that would have been claimed has not been. 

“We are confident that this move will help charities and, ultimately, will not cost government more than was projected in normal times.”

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