Make money when you give to Charity!
You've probably heard the saying,
'Giving to charity never diminishes wealth; it enhances your potential for prosperity.'
This age-old wisdom is not just a feel-good notion—it’s grounded in reality. In this post, I’ll show you how charitable donations can actually benefit your finances, using the UK tax system as a clear example.
When you donate to UK charities, you could unlock a powerful benefit through the Gift Aid scheme, which allows charities to reclaim an additional 25p for every £1 you give. This means your donations can have a far greater impact, as the charity receives extra funds from HMRC—making your generosity go even further.
But here’s where it gets even better: If you're a higher-rate taxpayer, you can also benefit from tax relief. Your Gift Aid donations can reduce your taxable income, lowering the amount of tax you pay. Essentially, your charitable giving could result in you paying less tax while helping the causes you care about.
Here’s an Example:
Let’s say you donate £100 to charity. With Gift Aid, that donation increases to £125. Now, as a 40% taxpayer, you can claim back £25 (that’s 20% of £125), further reducing your tax bill.
To Qualify:
Record Your Donations: Keep track of the donations you make during the year—dates, amounts, and to which charity.
Charity Eligibility: Make sure the charities are registered with the UK Charities Commission.
Taxpayer Status: You must be a taxpayer and have paid enough income or capital gains tax to cover the amount the charity reclaims.
By opting into Gift Aid, you're not only giving to a good cause—you’re maximizing the impact of your donation, creating a win-win situation for both you and the charity.
So, what are you waiting for? Giving to charity isn’t just a way to help others—it can also help you save on taxes while making a bigger impact. Start donating today and watch your generosity work for you!
Get in touch today if you want to benefit from lowering your taxes from your donations!
Feel free to reach out to our team for personalised advice on managing your corporation tax effectively.
