Char­ity con­cern on tax re­lief

The Peterborough Evening Telegraph - - Your -

A CITY ac­coun­tancy firm is warn­ing that char­i­ties are con­cerned about the fall­out if the Gov­ern­ment goes ahead with its pro­pos­als to re­strict tax re­lief on char­i­ta­ble giv­ing.

The 2012 Bud­get plans would cap how much in­come an in­di­vid­ual can off­set at £50,000 per year, or a quar­ter of their in­come, which­ever is higher from 2013.

Paul Evans, se­nior part­ner at Stephen­son Smart & Co, which acts for sev­eral char­i­ties and is mon­i­tor­ing the sit­u­a­tion closely, said: “Cur­rently in­di­vid­u­als can off­set their in­come against in­come tax re­liefs, and as a re­sult may pay no in­come tax at all.

“The Gov­ern­ment’s aims be­hind the pro­pos­als is to stop in­di­vid­ual tax­pay­ers with very high in­comes mak­ing use of un­lim­ited tax re­lief to avoid pay­ing tax at all.

“It re­mains to be seen whether it goes ahead, but char­i­ties are con­cerned that in­di­vid­u­als will re­duce their giv­ing as a re­sult of the cap.”

The Gov­ern­ment ar­gues that in­di­vid­u­als who want to give more than 25 per cent, or £50,000, of their in­come to char­ity may still do so, but from their taxed in­come.

HMRC has said it will be is­su­ing a con­sul­ta­tion doc­u­ment on the de­tail of the pol­icy, in­clud­ing im­pli­ca­tions for phil­an­thropic giv­ing, in the sum­mer.

Char­i­ties ar­gue that this is an un­nec­es­sary mea­sure that would be dam­ag­ing, par­tic­u­larly for many gen­uine char­i­ties which de­pend on large do­na­tions.

UK Giv­ing 2011, an in­depth sur­vey of char­i­ta­ble giv­ing, showed that in 2010/11 the UK public gave £11 bil­lion to char­ity, but the av­er­age monthly do­na­tions fell from £12 in 2009/10 to £11.

se­nior part­ner: Paul Evans, of Stephen­son Smart & Co.

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