# Gift Aid during the COVID-19 pandemic

- Link: https://fundraising.co.uk/2020/06/01/gift-aid-during-the-covid-19-pandemic/
- Published: 2020-06-01T15:47:37+01:00
- Author: Howard Lake

**HMRC has agreed to relax a few Gift Aid rules because of the COVID-19 pandemic.
Many of these have been negotiated by the Charity Tax Group.**

 

## Cancelled events

When a charity has to cancel an event because of the COVID-19 pandemic, HMRC accepts
the charity may claim Gift Aid on ticket refunds if individuals choose to donate
their refund to the charity under Gift Aid. HMRC requires charities to:

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 * contact the individual who paid for the event
 * explain they are entitled to a refund but may wish to donate this to the charity
 * make it clear they do not have to donate the refund but if they choose to donate
   it, it’s non-refundable
 * make sure the individual has enough tax to cover the donation
 * document the conversation with the individual and keep records of this
 * ensure that there is a Gift Aid declaration in place for the individual
 * keep a record of the email/conversation with the individual

This applies to refunds for fundraising events, challenge events, courses and conferences
but only if cancelled as a result of COVID-19. Normally, for Gift Aid purposes, 
HMRC expects charities to pay the refund to the individual who may then pay this
back to the charity under Gift Aid if they wish.

 

## Membership subscriptions

Some charities and Community Amateur Sports Clubs (CASCs) have suspended the collection
of membership subscriptions in light of the COVID-19 pandemic but some members are
making voluntary donations instead in order to support their club.

HMRC accepts there is no barrier to Gift Aid being claimed on such donations, provided
they are freely given, no benefits arise in consequence of that specific donation(
either now or in the future) or, if provided, they fall within the donor benefit
limits, and a Gift Aid Declaration is obtained. Where clubs have reduced their subscription
rate, any amounts freely donated over and above this reduced amount would also potentially
be eligible for Gift Aid. In all cases it must made clear to the members that the
amounts voluntarily given by them are not subscriptions, carry no subscription rights
and will be treated as donations on which the charity or CASC will claim Gift Aid.
The donor will need to provide a Gift Aid declaration confirming they have paid 
sufficient tax.

 

## Retail Gift Aid Scheme

The Charity Tax Group has negotiated a few COVID-19 related ‘easements’ with HMRC:

• **Oral declarations:** Charities may continue to make the claims despite not having
been able to issue oral confirmation letters so long as the charity’s staff or volunteers
have provided a full explanation as to the Gift Aid process and the donor’s having
to be a UK taxpayer

• **Returned mail:** if charities are not attending offices and have no knowledge
that they have received any returned notifications by post then they can continue
to claim Gift Aid as usual. Once they return to “normal” and start to open correspondence
then they should ensure that going forward they take the appropriate action such
as issuing a correction on the next Gift Aid claim. So far there has been no change
agreed by HMRC in the requirement to issue end of year statements to donors under
the pre agreed schemes by 31 May.

 

## Gift Aid Small Donations Scheme

Another easement negotiated by the Charity Tax Group relates to the Gift Aid Small
Donations Scheme. Normally GASDS donations must be a maximum of £30 paid in cash
or by contactless card. However, HMRC will accept that regular cash donors can save
up donations of up to £30 each and give them to the charity in a batch when it is
safe to do so. HMRC say ‘Where it is the case, for example, of separate donations
being given in a single envelope, then if the church/charity official is happy these
are clearly separate ‘small donations’ (and clearly stated as such) then they will
be eligible for GASDS, as is the case where separate envelopes are used”.

 

![Helen Elliott](https://wfay6x.infiniteuploads.cloud/2020/06/helen-elliott.jpg)

 

_**Helen Elliott** is a partner at [Sayer Vincent](https://www.sayervincent.co.uk/),
an audit and advisory firm working exclusively with charities and social purpose
organisations._

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