FUNDRAISING NEWS: Giving Campaign: tax inefficiency is £900m yearly cost

Charities could be losing out by more than £900m each year because only a quarter of all donors give tax efficiently, according to figures released by The Giving Campaign.

The campaign, which works nationally to increase the amount of money raised for UK charities, says that although 70 per cent of people give to charity, only one in four are using Gift Aid.

However, similar research released by Bacs, the company that processes direct bank payments and credits, puts the figure lost by charities at a more conservative £395m per year.

The figures differ because, although both organisations agree that 50 per cent of the nation are taxpayers eligible for Gift Aid, and that three quarters of these do not currently take advantage of the system, they disagree on the overall annual amount donated to charity.

While Bacs estimates that £3.2bn is donated to charity each year, The Giving Campaign, which based its figures on research by the Charities Aid Foundation and the NCVO, says that £7.3bn was given in 2002.

Also, the two organisations differ on which sex gives more, with Bacs claiming men are more generous.

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