Following consultation with the Revenue Commissioners, the Irish Charity Tax Reform Group (ICTR) has published details of the changes to charity tax relief which came into operation at the beginning of the year.
The operational details were announced by officials from the Charities Unit in the Revenue Commissioners at a briefing session arranged by ICTR last month at which the new forms CHY 3 and 4 were launched.
The main points from the revised regulations relating to charity donations are:
- The tax refund for donations from all donors regardless of their tax status (PAYE or Self-assessed) will now go to the charity in all cases at a blended rate of 31%. Charities no longer need to ask donors about their tax affairs and the only reason that a refund claim will be rejected is if the donor has not paid sufficient tax in the relevant year to cover the reclaim or inaccurate details have been supplied.
- The qualifying donation threshold remains at €250 and must still meet the condition of being given “at arms-length with no strings attached” i.e. there can be no benefit to the donor.
- The tax relief will now be given at a blended rate of 31% regardless of the rate of tax paid by the donor and this will be on a grossed up basis.
- An annual limit of €1 million per individual can be relieved under the revised scheme and donations under the scheme are no longer subject to the higher earner restriction because the tax refund goes to the charity in all cases, not to the donor.
Further details on the new details are available on the ICTR website and new tax reclaim forms are available from the Revenue Commissioners.
There is no change to the corporate tax relief. Companies continue to treat donations as a normal business expense and there is no upper limit on the amount that can be donated.
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