Between 1987, when Payroll Giving was first launched, and April 2004, 901 SMEs provided payroll giving opportunities for their employees. By September 2005, this figure had risen by almost the same amount again, with a further 998 organisations signing up.

The rise is due to the introduction of the Payroll Giving Grants Programme, administered by the Institute and funded by the government, which offers up to £500 to employers who sign up before December 2006, plus a matched gift of up to £10 a month for the first six months after an employee takes up the offer.

The success of this programme has led the government to provide a further grant to the Institute, which will be used to fund a tax-effective giving programme. This will include training for charities, a new mentoring scheme that will offer support and guidance on Gift Aid and other forms of tax-effective giving, plus the production of a practical toolkit, website and helpline – all of which will be promoted through a marketing campaign that will aim to encourage best practice within charities of all sizes.

Lindsay Boswell, chief executive of the Institute, said: “Tax-effective giving is about maximising income, and moreover, it is best practice. We are delighted that we can now apply our expertise in delivering targeted information, practical advice and training opportunities that cover the full range of tax-effective giving methods out to the wider fundraising community.”