Voluntary sector umbrella bodies have used the public reading stage of the Small Charitable Donations Bill to call for the government to scrap elements of the Gift Aid Small Donations Scheme they say will make the scheme difficult for small charities to use.
The GASDS is intended to allow charities to claim Gift Aid-like payments on up to £5,000 of small cash donations a year, without accompanying Gift Aid forms.
But to claim the full £1,250, charities must have claimed at least £625 of Gift Aid in the same year. In addition, charities can only claim if they have claimed Gift Aid in three of the past seven years, and have a good track record with HM Revenue & Customs.
The Small Charitable Donations Bill, which will introduce the scheme and is going through Parliament, has reached the public reading stage – an experimental stage being used for only the second time that is intended to improve engagement with the law-making process.
The Institute of Fundraising said in its response: "The implementation of the scheme through this bill does not appear to be fit for purpose for the original aims.
"The proposals seem overly complex and controls seem disproportionate to the amount of money that might be claimed by charities."
The Charity Finance Group and the National Council for Voluntary Organisations both recommended the removal or substantial revision of clause 1.4, which introduces the "matching" element to the bill. Both bodies, along with the Charities Aid Foundation, called for changes to be made to section 2.1, which says a charity must have a good track record, to make it easier for new organisations to use the GASDS.
The three bodies also said "community building" rules, which are intended to allow local branches of large organisations to put in separate claims, were unnecessarily restrictive.
In particular, they suggested the government should amend or remove a rule meaning that charities can only claim under the GASDS if they were engaged in their charitable activity while the money was collected.