Tax-efficient giving

Tax-efficient giving for individuals

Advice about charitable gifts from individuals is available from HM Revenue and Customs. A summary of key information is below. If you have a personal accountant, we recommend you consult them for advice about the most tax-effective gift for you.

Gift Aid

Gift Aid enables charities you support to get extra money on your donation without it costing you a penny more. To make a Gift Aid donation, you must be a UK taxpayer. Your donation is treated as if basic rate income tax had been deducted: charities can, therefore, reclaim that tax from HM Revenue & Customs (HMRC).

For example, on your donation of £10,000, we can claim £2,500 in Gift Aid, meaning your gift total will be £12,500.

Tax relief for higher rate taxpayers

If you pay tax at the higher rate, you can claim back the difference between the higher rates of tax (40% or 45%) and the basic rate (20%) on the total value of the donation.

For example, if you pay the 40% rate, a donation of £10,000 allows you to recover £2,500, so the donation costs you only £7,500 net, but the Community Foundation receives £12,500. If you pay the 45% rate, a donation of £10,000 allows you to recover £3,125, so the donation costs you only £6,875 net, but we receive £12,500.

Self-Assessment giving

If you complete a Self-Assessment tax return and are entitled to a tax refund, you can choose to have all or part of the repayment sent directly to a charity of your choice. This is called ‘Self Assessment Giving’ or ‘SA Donate’. You can also ask the repayment to be made as a Gift Aid donation. HM Revenue & Customs (HMRC) sends your refund (plus any Gift Aid tax repayment) directly to the charity by electronic transfer.

Gifts of assets: land, buildings, shares etc.

Individuals can get tax relief on gifts to charity of certain listed shares, securities and other investments. You can get income tax relief, in addition to the capital gains tax relief on gifts of assets to charity. The tax relief applies if you give, or sell at less than market value, any qualifying investments to a UK charity.

Payroll giving

An unlimited amount can be contributed to charity via payroll giving. It costs you less to give because your donation is given to charity from your gross salary before any tax is taken off – so you don’t pay tax on it.

Giving in your will

If your estate is liable to Inheritance Tax you could choose to leave money to charity to reduce the overall amount of tax due from your estate. You could either leave a fixed sum (known as a ‘Pecuniary Legacy’) or part or all of your estate once other gifts have been distributed (known as a ‘Residuary Legacy’).

You can do this through your will, or simply by a declaration to the executors giving instructions as to how, and to which charity, your legacy is to be distributed. Gifts made to a UK charity in the seven years prior to your death are also covered by the same exemption from Inheritance Tax.

Your personal accountant or solicitor will be able to advise on the best option for you.
Tax-efficient giving for companies

For information about gifts from companies to charity, we advise you to visit the HMRC website.

Donations by limited companies

Your company’s donation to charity is deductible from its total profits when calculating Corporation Tax. Corporate donations are not eligible for Gift Aid.

Gifts of land, buildings or shares

Your company could benefit from Corporation Tax relief if it gives land, property or qualifying shares to a charity, or sells them to a charity at less than their market value.

Payroll giving

An unlimited amount can be contributed to charity via your employees’ payroll giving. It costs your employees less to give because their donation is given to charity from their gross salary before any tax is taken off – so they don’t pay tax on the gift.

Tax-efficient giving and legacies

Legacy gifts are exempt from inheritance tax and could reduce the total amount of tax paid on your estate. From 6 April 2012, if you make a gift in your will to a charity of at least 10% of your net estate, the rate of inheritance tax due on the taxable part of the estate is reduced from 40% to 36%. A gift of 10% can leave the same amount available to your other beneficiaries as one of 4%. Any gift greater than 4% but less than 10% results in your beneficiaries receiving less money than they would have done if the gift was for 10%. Here is an example.

On an estate of £1m, after deducting the nil-rate band (£325,000 to 2015) the net estate is £675,000.

a) If a gift of 10% of the net estate is made then:

£713,800 would be payable to the other beneficiaries
£218,700 would be payable in Inheritance tax (at the new 36% rate)
£67,500 would come to the charity
b) If a gift of 4% of the net estate is made then:

£713,800 would be payable to the other beneficiaries
£259,200 would be payable in Inheritance tax (at 40% rate)
£27,000 would come to the charity
c) If a gift of 8% of the net estate is made then:

£697,600 would be payable to other beneficiaries
£248,400 would be payable in Inheritance tax (at 40% rate)
£54,000 would come to the charity

For more information about giving options please contact: CEO Steve Duncan on 01422 438737 or Email [email protected]

Why Choose CFFC to donate to?

Since the Community Foundation For Calderdale began in 1991 we have worked with thousands of groups across the borough and awarded £30m in grant aid. Including raising and distributing £150,000 during flooding in 2012/13, we supported over 500 flood hit homes in the Calder Valley. You can read our Flood Needs Assessment carried out with flood grant recipients here.

We are dedicated to effecting change, creating opportunities, and supporting those in need in Calderdale. That is why every penny raised in Calderdale, stays in Calderdale. 

As a donor to the Community Foundation for Calderdale you will be able to see first-hand the difference your donation is making, you will receive regular updates, you may visit the projects you have funded to meet the people who are putting your gift to great use.

A donation to the Foundation really can change lives right here in Calderdale for example:

Rotary In Calderdale were awarded a grant to run the shoe box appeal, the appeal asks local residence to fill a shoe rotarybox with food, soaps, toys etc, the boxes are then distributed to local vulnerable people in Calderdale.

Here is what they said about the grant: “The project was very successful, 16 Primary Schools and students helped fill boxes and the feedback from the schools was very positive. The public response was fantastic, just goes to show the capacity for giving that is in all of us, to help the less well off. Over 2000 boxes were distributed in Calderdale last year.

St Georges Youth Project were awarded a grant to work with young people who were at risk.

st georgesHere is what they said about their grant: All members of the family we are working with have low aspirations and self-esteem.  The adults in the home don’t work and both misuse cannabis, allowing the lads to do the same.  The family have no boundaries in place, routine or stability.  The lads don’t have a bed time and the adults sleep downstairs on the sofa.

The older lad (16) should be in his final year at school but because he keeps leaving Halifax to live with his dad on and off he has never been picked back up by the educational system, giving the younger lad a reason to refuse to go to school and kick off.   Mum has got a history of depression and throws money at the lads to try and make up for the family downfalls but it is money she hasn’t got.  Budgeting skills are a major issue as is spending priorities.  Domestic violence has been reported and the family are known for not engaging with services.

In October 2012, through the community project the older lad attended a training provider to learn basic plumbing. plastering and tiling skills. He completed 4 weeks of the 10 week course before packing it in.
Intensive family support work for the family started first with an emergency call to provide food, heating and a bed to the family throughout the Christmas period.  Staff had discussions with housing regarding the state of the house and arrears.  A referral to the MAZE project was made with consent regarding domestic violence.

In February 2013, Mum started to attend the community drop in just for a coffee and a chat to start off with.  Now she attends with her older son.  They are currently working through functional skills.  Mum’s partner has completed his CV through the project and is now actively looking for work.

Project Challenge were awarded a grant to support a young person in am apprenticeship.

Here is what they said about the grant: Project Challenge have run a very successful apprenticeship programme project challenegfor one young man.  He completed his Level 2 in Youth and Community work and has now gone on to do his Level 3.

We have very high hopes for this young man and he is now in a full time permanent position and is about to undertake his Mountain Leaders qualification in September.

We make donating to Calderdale groups simple, we provide you with peace of mind by carrying out all the necessary checks prior to awarding any grants to groups. We work with the groups we fund on an ongoing bases to measure and report on the impact of each grant. Our expert knowledge and over 20 years experiences, means that we can  provide you with all the information you need, whether it be about local needs, which groups are working in different areas, or who is tackling different themes.

Using a wealth of research and experience, our expert Team helps you connect with those in targeted ways that suit you. Effectively. Efficiently. The Team comprises: Steve Duncan DL (CEO); Rob Billson (Grants and Donor Services Manager); Robert Hustwick (Finance Manager); Board of Trustees.

By donating to CFFC you will avoid any legal and administrative expenses of setting up a charitable trust, this includes reviewing applications, responding to applications, providing funding, and following up to evaluate the impact of the grant.

There are many ways to support our work, to find the best solution for your charitable giving please click here.

Alternatively you can call our CEO Steve Duncan DL on 01422 438737, to arrange an appointment to discuss your philanthropic giving.