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Changes to GASDS and tax rules take effect this month

Melanie May | 20 April 2017 | News

Changes in rules for the Gift Aid Small Donations Scheme (GASDS) have come into force with the start of the new tax year.

The changes to GASDS came into effect at the beginning of April, with revised guidance from the Government.

The Act changes the Gift Aid Small Donations Scheme by removing the two-year eligibility rule and the Gift Aid history requirement to allow more smaller and newer charities to benefit sooner, and allowing contactless donations to be eligible.


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Charities, and groups of charities, may now claim under the main allowance or under the community buildings allowance, but not both, while changes to the community buildings rules to allow donations received outside of the community building but within the same local authority area to qualify mean more charities will be able to benefit from the work they carry out in their local communities.

HMRC’s entry level guidance note and detailed guidance note have also been updated, following consultation with sector bodies including the Charity Tax Group.

New rules relating to Gift Aid and intermediaries also take effect from this month, while other changes with the potential to affect charities include new off-payroll working rule for public sector employers, the start of the Apprenticeship Levy, and an enlargement of the Social Investment Tax Relief.

The Charity Tax Group welcomed the GASDS changes but called for the Government to continue to review the effectiveness of the changes, and to consider further reforms.

CTG chairman, John Hemming, said:

“In respect of the Gift Aid Small Donations Scheme (GASDS) the relaxation of the eligibility requirements, clarification of the community buildings rules and extension to contactless payments are all welcome and we hope that these changes will help to widen accessibility to the Scheme, particularly among smaller charities. However, we encourage the Government to continue to review the effectiveness of these changes, and consider further reforms, if there is no significant additional take-up.

“The other tax changes do little to address concerns about the overall complexity of the tax system for charities and there is a real risk that new burdens such as the Apprenticeship Levy will begin to undermine the charities’ operational effectiveness.”