Give a gift that keeps on giving

Why it’s so important to support good causes The past 12 months have been difficult and often scary, but most of us are lucky enough to have a warm home, food on our table and people we love.

When things in my life aren’t going according to plan, I count my blessings and think about what’s going well instead – because there are always others who have bigger problems to worry about.

Coronavirus has had a huge impact on charities around the world, which have felt the effects of the pandemic from both sides.

Donations have reduced as people tightened their spending and the numbers in need have increased as more people fall on harder times.

If you rarely or never give to charity, it may seem an odd thing to consider.

“Charity begins at home,” is a response I often hear when I discuss this. But helping others can be a particularly rewarding act, whether you give with your time – as so many have in the past year – or your money. I think we should all do what we can.

When you support a charity with a donation, there are Government financial benefits for you, too.

Many donations to charities include the option of Gift Aid, so that effectively for every £1 you give to a charity, it can claim the basic rate of income tax on your donation, making it worth an extra 25%.

If you’ve ever donated via text message, you may recall receiving the “opt-in to Gift Aid” replies.

If you are a higher or additional rate taxpayer, you should claim the higher or additional rate of income tax via

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Helping others – by giving either time or money – can be so rewarding

your self-assessment, or by asking HMRC to amend your tax code. This means you can claim further tax relief if you pay more tax. It is important to note that because the charity is receiving tax relief on your donation, you must have paid tax to the level you are claiming for it to be allowable.

Some employers run a Payroll Giving scheme, which means your charity donations come straight out of your gross income, saving your tax immediately with no claim required.

For some, the thought of making a monthly donation is impossible – but there are other ways you can help a charity. You can leave money to a registered charity in your will, and any payment will be made free of inheritance tax. This donation can also reduce inheritance tax.

If you gift 10% or more of your estate to a charity, the rate of inheritance tax chargeable on your estate is reduced slightly, from 40% to 36%.

This is particularly beneficial if you’d like to give to a charity but cannot afford monthly donations, or if your estate is subject to inheritance tax.

In Winston Churchill’s words: “We make a living by what we get, but we make a life by what we give.”

We were all affected by this pandemic. Let’s emerge together.

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