Tax-efficient giving
Here is a brief guide to how you can contribute to the work of SOS Children in a tax-efficient way.
Payroll-giving
Payroll-giving enables employees to make automated tax-efficient donations to one or more charities from their monthly pay packet. Your company deducts the donation from your salary before tax and other deductions are calculated. Therefore you do not pay tax on the income you have chosen to donate to the charity.
It costs less to donate more, so you may consider increasing your donation!
One-off donations such as a contribution from an annual bonus can also be made to the charity through payroll-giving.
| 20% tax rate payer |
20% tax rate payer |
40% tax rate payer |
40% tax rate payer |
50% tax rate payer |
50% tax rate payer |
|
|---|---|---|---|---|---|---|
| employee donation received by charity |
tax relief |
cost to donor |
tax relief |
cost to donor |
tax relief |
cost to donor |
| £5 |
£1.00 |
£4.00 |
£2.00 |
£3.00 |
£2.50 |
£2.50 |
| £10 |
£2.00 |
£8.00 |
£4.00 |
£6.00 |
£5.00 |
£5.00 |
| £20 |
£4.00 |
£16.00 |
£8.00 |
£12.00 |
£10.00 |
£10.00 |
| £100 |
£20.00 |
£80.00 |
£40.00 |
£60.00 |
£50.00 |
£50.00 |
For this to happen, your payroll department needs to forward the deductions to the charity via a Payroll Giving Agency. The three main agencies are The Charities Aid Foundation, The Charities Trust and South West Charitable Giving
To donate via payroll giving, simply complete and return this payroll giving application form to us.
Matched giving
Sometimes companies will match charity donations from their employees – usually an exact match, sometimes two times the original donation. This can follow the original donation (if specified, some employees do this to pay the full £20 sponsorship amount).
Share-giving
Share giving enables donors with investments to receive substantial tax relief on their income tax bill, as well as exemption from capital gains tax on any gains they have made from their shares.
With the higher rate of income tax and capital gains tax at 40%, this can amount to a substantial tax break. All the tax relief goes to the donor.
A gift of shares worth £10,000 costs just £6,000 for a higher rate tax payer, because 40% of the value of the shares can be offset against their income tax bill.
Donors should always refer to their own financial advisor to calculate personal tax relief as it will depend on individual circumstances.
If you want to give shares you need to complete a stock transfer form to take the shares out of your name and put them into SOS Children’s name
For more information, please refer to the HM Revenues & Customs website.
Higher rate tax payers
If you complete a Self Assessment tax return and are entitled to a tax refund, you can choose to have all or part of the repayment sent directly to charity. This is called ‘Self Assessment Giving’ or ‘SA Donate’. You can also ask that the repayment is made as a Gift Aid donation.
To use Self Assessment Giving you need to enter a charity reference code in the space provided on the ‘Giving your tax repayment to charity’ form that comes with your tax return. SOS Children’s reference code for this purpose is: AAD70CG
To find out more
Go to our 'Find out more' section to get in contact with our Corporate Liaison Coordinator and to learn more about how a partnership with SOS Children could work for your company.
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