If you are paying income tax, a way of increasing the value of your giving by 28% is to Gift Aid. This is because the government allows any recorded donation to charity to be tax free.

Over sixty families in the church now gift aid and the recovered income tax accounts for about 18% of the church's annual income - a significant proportion!

How do I Gift Aid?

All you need to do is fill out a very simple form and give in a way that your gift can be recorded (e.g. through the envelope scheme, standing order or a cheque).

You can increase or decrease your gift as your circumstances change – you don’t have to fill out a separate form.

The only condition is that you let the treasurer or gift aid secretary know if you are no longer paying tax. The gift aid will then stop.

What next?

Please consider gift aiding. It is very simple to do, it does not lock you into a long term commitment (unlike the old covenant scheme which it replaced) and it does increase the value of your giving by 28%.

Please get in touch with John Berry, the Gift Aid Secretary ' 723359 email: John Berry or mention it to a church steward or the minister

How does Gift Aid work?

Suppose you are a tax payer and give £100 to the church.

• You need to ‘earn’         £125

• Tax paid                        £25 (tax is assumed to be paid at
                                                  the standard rate of 20%)

• Leaving                         £100 to give.

The church can now recover the tax of £25 through gift aid.
However, with the tax changes announce in 2008 budget, the government is allowing tax recovery at the old 22% base rate which means the value is equivalent to £28.

Am I paying tax?

You can be paying pay tax on a number of things – on earnings, occupational pension, bank and building society interest and share dividends. Any tax you’ve paid can be recovered through gift aid.

But I’m not sure I pay tax at the ‘standard rate’

On some of your income you will be paying no tax, some at 20% and possibly some at more. The rate at which you pay tax is not important – it is the amount of tax you pay that can be recovered.

How much can I gift aid?

Let us suppose you have an investment on which 20% tax is paid that pays each year

• gross interest    £700

• tax                    £140 (20% of 700)

You could gift aid up to £500 because you have paid sufficient tax

• Gift                   £560

• Tax paid            £140 (25% of 560, see ‘How does it work?’)

The church could recover the tax making your gift worth £700.

This is the exact way of calculating it but :

A simpler calculation 

• add up approximately all the tax you pay in a year from whatever source

• multiply by 4. You can now safely give up to that amount and know you have paid sufficient tax to claim gift aid.

Example

• Say your total tax is     £150

• Multiply by 4                £600

You can give up to £600 in gift aided donations (you can also give more that is not gift aided!)

We hope this is not too confusing!!