CAF reveals lack of knowledge on charity tax giving 21/04/09

A new report by the Charities Aid Foundation (CAF) published today reveals that almost a third (32%) of UK adults don’t know they can give to charity tax effectively.

Unprompted only one in three adults could name Gift Aid, 7% said payroll giving and 1% cited legacies as a means of giving tax-effectively.

Last year Gift Aid was worth £900m to charities but CAF estimates that around £752m goes unclaimed every year.

Most peoples’ experiences of using tax-effective giving are positive, with almost all (98%) Gift Aid users and 84% of payroll giving users satisfied with the experience. However, less than half of non-users are positive about Gift Aid.

The report, The Public Bond with Tax-Effective Giving in the UK, presents the results of a survey of 1,307 adults into public awareness and usage of all tax-effective giving methods: Gift Aid, payroll giving, legacies, gifts of land or buildings, and share giving.

The paper also sets out CAF’s policy recommendations to improve take-up of tax-effective giving.

The survey found that Gift Aid is by far the most commonly used method of giving tax- effectively with over a third of respondents (37%) having ever used it, compared to less than one tenth of respondents who had used any other form of giving tax- effectively.

Awareness of these methods of giving is highest amongst higher rate tax payers who are almost twice as likely to be aware of Gift Aid and payroll giving as basic rate taxpayers.

Main recommendations:

• Government should work with the sector to raise awareness of Gift Aid amongst the public through creative campaigns.

• Government and the sector should work with financial advisors to raise awareness and understanding of tax-effective giving.

• The research shows that if non-users are encouraged to try these methods of giving they are more likely to use them again in the future. Therefore Government should work with companies to improve access to payroll giving.

• Government should continue to work with the sector to simplify Gift Aid in order to make it easier for spontaneous gifts to be tax efficient, for example text donations.

• The case for enabling an opt-out approach to Gift Aid should be further explored by Government and the fundraising community.

• The majority of higher rate taxpayers would be willing to give their relief on charitable donations back to charity but the current system puts them off.

Commenting on the publication of the report, CAF CEO John Low, said: “Despite concerted effort by governments, fundraisers and intermediaries this report reveals a gulf in public awareness and understanding of tax-effective giving.

“There is significant scope for further improvements to and promotion of tax-effective giving. In these difficult financial times tax-effective giving is an excellent way to boost donations and help charities support the most vulnerable in society.

“I hope this evidence and the policy recommendations will help inform Government and the sector and assist in realising the potential of our generous society.”

A full copy of The Public Bond with Tax-Effective Giving in the UK can be found on CAF’s website:


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