Multiple small donations submitted together by individuals to remain eligible for GASDS
Melanie May | 9 March 2021 | News
HMRC has confirmed that multiple small donations handed over together are still eligible for the Gift Aid Small Donations Scheme (GASDS) even if the total is over £30 – as long as the charity or church official is satisfied the money is from separate small donations.
With church services and events largely unable to take place as usual during the past year, a concern has been that people such as churchgoers who would ordinarily give a small donation each week have been unable to do so and have instead been saving up their donations to give at a later date.
With this potentially meaning that the donations were then ineligible for the GASDS scheme if over the £30 limit, last April the Charity Tax Group (CTG), supported by the Churches’ Legislation Advisory Service (CLAS) and others, urged HMRC to introduce some temporary flexibility in its operation by accepting multiple cash donations of £30 or under that have been saved up during the crisis. The submission noted that ultimately the cap on eligible donations would remain at £8,000, so there would be no additional cost to the Exchequer.
HMRC has confirmed that this is acceptable, and at the HMRC Charity Tax Forum meeting in January 2021, confirmed to CTG that it was not unique to the pandemic and it was also not a concession; provided the treasurer was satisfied that the pile of cash received was multiple small donations which happened to be in one envelope, then they could claim GASDS subject to the normal rules.
HMRC’s response to CTG stated:
“In respect of GASDS, guidance on the eligibility for donations for inclusion in this scheme is clear in stating that claims can only be made on cash donations of £30 or less; and contactless card donations of £30 or less collected on or after 6 April 2019. The decision over what constitutes an eligible donation is one for the church/charity to make for themselves, rather than for HMRC, but the conditions for something to be considered a ‘small donation’ are clearly set out in legislation. 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.”
For example, if a church member puts £200 cash in an envelope and marks it as 10 weeks of £20 weekly donations for the occasions where they have not been able to make a regular cash offering, HMRC would be happy for the church to regard them as eligible donations under GASDS. 10 separate envelopes with under £30 could also be included where these are clearly separate donations.
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About Melanie May
Melanie May is a journalist and copywriter specialising in writing both for and about the charity and marketing services sectors since 2001. She can be reached via thepurplepim.com.