# Research on tax aims to encourage greater giving

- Link: https://fundraising.co.uk/2009/11/10/research-tax-aims-encourage-greater-giving/
- Published: 2009-11-10T10:50:14+00:00
- Author: Howard Lake

Philanthropy Ireland and the Irish Charities Tax Reform Group have published research
on tax and regulatory policy with the aim of encouraging greater charitable and 
philanthropic giving in Ireland.

 

The research was carried out by Farrell Grant Sparks Consulting (FGS) and the key
recommendations include:

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— Reducing the current threshold above which tax relief may be applied from €250
to a new rate of €175

 

— That the tax relief applying to donations to charitable organisations should be
decoupled from the provision in the Finance Act 2006 to limit the use of tax reliefs
by higher earners (i.e. those with an adjusted income over €250,000) as the donor
does not receive any benefit from the donation. In keeping with the recommendation
of the Commission on Taxation they recommend that this relief be capped at an upper
threshold of €500,000

 

— Extending the provision of tax relief on donations of cash and securities to charity
to include donations of property

 

— The introduction of tax benefits in relation to the donation of property through
the use of split/charitable remainder income trusts (i.e. where donors put property
in trust for a charity with the rights to the capital and income elements being 
split between the donor and the recipient)

 

— The introduction of a VAT subsidy for charities to compensate for VAT incurred
on inputs, similar to the scheme that is currently operating in Denmark where the
subsidy is based on the proportion of funds received by the charity from private
donations

 

— The removal of the two-year waiting period for charities to become eligible to
claim tax relief on donations

 

— A relaxation of the rule where an individual’s tax relief is restricted to 10%
of their income tax where they have an association with the charity

 

The report will be used to try to influence government to achieve a taxation and
regulatory environment that specifically encourages greater philanthropy in Ireland.

 

The full report can be downloaded from Philanthropy Ireland’s website.

 

www.philanthropy.ie

 

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