Gift aid reform – Budget announcements

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09 May 2011

Several new measures for the reform of gift aid were announced in the Budget this year.

Many charities and their advisers have long been calling for reforms to the gift aid system and the following measures go at least some way to addressing their concerns:

  • With effect from April this year, the limit of the amount of benefit which a charity can provide to a donor is increased from £500 to £2,500.

  • From April 2013 charities (and community amateur sports clubs) who receive small donations of £10 or less will be able to reclaim gift aid without having to ask for a gift aid declaration from the donor.   The maximum amount which can be claimed this way is £5000 per annum.  This is good news for smaller charities although the £5,000 limit has been criticised by some.

  • A new on-line gift aid filing system for charities to register their details for gift aid and to make gift aid claims will be introduced by HMRC in 2012-13.  It is hoped that this will ease the extremely cumbersome current process whereby registration and repayments can be delayed for weeks.

Other measures to encourage philanthropy were also announced, including a reduced rate of inheritance tax for those who leave 10% or more of their estate to charity, and a consultation on a tax reduction for gifts of art to charities.

For further information, please contact Charles Wyld on (0)117 902 2773 or email or Nicola Manclark on (0)117 902 2743 or email

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