1. Institute of Fundraising – South West Gift Aid 2018
Ms Phil Robson
Mrs Elanor Hoskin
Wednesday 2nd May 2018

2. Gift Aid at eighteen

3. Government report on Gift Aid published March 2018
The stats
Government report on Gift Aid published March 2018

4. Has Gift Aid come of age 2000 – 2018 and beyond

5. £179m incorrectly claimed
£600m underclaimed
£179m incorrectly claimed
HMG: 2017 Research - Charities missing out on £600m because people are not enabling them to claim Gift Aid on donations

6. Eligible Donors who don’t sign up for Gift Aid
Ineligible donors who have not paid tax, but take tax from the Treasury to give to charities
Gift Aid tax Gap

7. Overview Gift Aid – Collective industry responsibility
What are the barriers to successful Gift Aid
Why are charities losing £600million a year in unclaimed Gift Aid
What is my charity doing about Gift Aid

8. How does Gift Aid breakdown
Gift Aid added to 52% of the total value of donations, with charities claiming £1.16bn (2017)
Proportionally, 73% of donations to online giving added Gift Aid- compared to 50% Gift Aid across other channels.
Whilst Gift Aid declaration is lower for direct debits, this channel generates the highest Gift Aid value because donation values are the largest.

9. Non-taxpayer: Individual with a gross personal income of less than £10,600 a year (income levels change) – No Gift Aid
Basic rate taxpayer: Individual with a gross personal income between £10,600 and £42,384 (inclusive) a year (income levels change) – Gift Aid for the charity
Higher or additional rate taxpayer: Individual with a gross personal income of £42,385 or more a year (income levels change) Gift Aid for the charity and tax refund for donor
Three tax statuses

10. HMG found: most effective ways public donate to charities
More people donate through bucket and tin collections
Most income is raised is through Direct Debits
HMG found: most effective ways public donate to charities

11. Volume versus value In “people” numbers
More people Gift Aid online either through sponsorship or direct to the charity
Conversely more people donate without Gift Aid via buckets (not including GASDS)
Most income not collecting Gift Aid is
Direct Debits and charity envelopes containing cheques
And yet we know Direct Debits generated the highest Gift Aid £ for £
Other than legacies, Committed Giving is closest bond between charity and donor

12. Main Barriers to Gift Aid
For tax paying Donors who do not opt into the scheme
They do not engage with charities beyond the donation
Charities who do not know how to engage with these donors
Cite confusion around the rules of who can gift aid their donation
Main Barriers to Gift Aid

13. HMG Research: Donor Awareness
Across all tax statuses Donor Awareness is high, over 80% have heard of Gift Aid
However when asked if they understood Gift Aid this dropped to between 30-35%
Even people who said they understood Gift Aid said their knowledge of the scheme was “good to fairly good”

14. Why do eligible donors not add Gift Aid “sometimes/never”
It is mostly driven by a perceived lack of opportunity to add Gift Aid
And by a misunderstanding of Gift Aid and not recognising their eligibility to add it.
Why do eligible donors not add Gift Aid “sometimes/never”

15. % of Income by Source to which Gift Aid is added (2016/17)

16. The facts

17. What can charities do to increase income and mitigate risk

18. What is a Gift Aid Income Stream
Individual Donations
Sponsorships (via events)
Visitor sites (Museums. Zoos etc)
Membership and Friends Schemes
Retail Gift Aid (High street charity shops/furniture collections)
Gift Aid Small Donations Scheme (GASDS)
What is a Gift Aid Income Stream

19. Understanding the Gift Aid Rules
At least 6 different Gift Aid Income Streams
Over 35 HMRC rules affect Gift Aid
Each income stream has its own particular set of Gift Aid rules
Charity has to know which of these rules affect particular income streams so can explain to donors
Understanding the Gift Aid Rules

20. Why is Gift Aid confusing donors and charities
Gift Aid declaration
Benefits Rule
Individual Donations
Annual Pass
10% on entrance fee
Visitors Sites
People put money in a bucket
No Gift Aid Declaration Form
Gift Aid Small Donation Scheme
Personal items donated to charity
Donors own Gift Aid to point of claim
Retail Gift Aid

21. S.W.O.T. What are our potential Gift Aid income streams
Can our data and technology support a Gift Aid programme
Do we understand the Gift Aid rules
Can we engage effectively with donors
Gift Aid

22. Most Common “weaknesses” and lost “opportunities”
Charities unclear of the rules
Ineligible donors are signing up for Gift Aid
Donors sign invalid declarations
Eligible Donors are not signing up
Most Common “weaknesses” and lost “opportunities”

23. Failure to understand the “Benefits Rules”
Annualising gifts against incentives - especially for Major Donors
Individual Donations
Exceeding the benefits participants and their connected families are allowed before invalidating Gift Aid
Sponsorship
Do the benefits your membership receive exceed the benefits rule
Memberships
Failure to understand the “Benefits Rules”

24. Charities need to train and educate people directly connected
Head Office
Shop Managers
Volunteers
Donors
RGA

25. HMRC ruling on the RGA audit rules
“Charities should keep records of staff/volunteer training and guidance, to demonstrate that all their staff and volunteers have a good understanding of the processes.”
“records of checks the charity has carried out on each of its shops to ensure that the Retail Gift Aid process is operated correctly”
HMRC ruling on the RGA audit rules

26. Visitor Sites – common mistakes making Gift Aid invalid
No understanding of difference between the Annual pass and 10% on admissions rule
Volunteers expected to deliver the Gift Aid rules with little or no knowledge as to how to explain
No clear signage for and engagement with visitors to explain what Gift Aid is, and their rights to enter if they choose not to Gift Aid
Visitor Sites – common mistakes making Gift Aid invalid

27. Common errors in what a Gift Aid Declaration is
Web declarations can be written or oral but there is no “web” declaration
Web Declaration
Depending on your technology, most is written Gift Aid but there is no “Visitors Pass” declaration
Visitors Pass
Special scheme embracing both written and oral
Written declaration to join, there is no “RGA Declaration”
RGA
Common errors in what a Gift Aid Declaration is

28. Different Income Stream different rules
Oral/Written
Visitor Sites
Written
RGA
Web
Oral
Telemarketing
Different Income Stream different rules

29. However you dress it up there are only two Declaration Types
Written
Oral
However you dress it up there are only two Declaration Types

30. Top reasons charities fail Gift Aid audits
Lost Gift Aid declarations
Invalid Gift Aid Declarations types
Incomplete Audit trail
Top reasons charities fail Gift Aid audits

31. £Hundreds of Millions remain unclaimed each year
Be honest about your own Gift Aid Knowledge. If you need training – ask
Make sure your charity educate and train both donors and charities (including your volunteers!)
S.W.O.T. Invest your Gift Aid resources in the best chance of a risk free return
All good work on recruiting Gift Aid will be lost in poor Gift Aid management and administration
£Hundreds of Millions remain unclaimed each year

32. Putting resources into your Gift Aid programme
5% of your Gift Aid income invested back into Gift Aid
Put the Gift Aid rules into the charity, do not rely on one person to run your scheme
Treat Gift Aid as any other income stream – it needs experts to run an effective scheme

33. Who is liable for Gift Aid at your charity
Charity trustees are ultimately responsible for ensuring that all claims are correct
And have an obligation to ensure that appropriate systems are in place to achieve that result
This includes making sure proper training is available
And making sure resources are made available
Trustees
Who is liable for Gift Aid at your charity

34. Remember
Most people have heard of Gift Aid, very few people understand Gift Aid
The charity need to understand the Gift Aid rules or cannot target Gift Aid donors
Understand the Gift Aid rules that affect your income streams.

35. Venues to be announced Workshop Content To book a place please contact
19th and 20th September 2018
16th and 17th of October 2018
Venues to be announced Workshop Content To book a place please contact

36. Question Time!