News3 mins ago
Tax
13 Answers
I paid a charity Some money and was talked through the stages . So when it came to give aid they just ticked yes .It just crossed my mind now that as a pensioner I’m not paying tax .So I am prepared to repay the aid gererated by my donation How will this this be asked for and paid for .Any ideas
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Hope this helps
To work out if you have paid enough tax to cover your donations, divide the donation value by four and compare this figure to the amount of tax that you have paid for the year. Remember to add all the Gift Aid donations you have made in the tax year and that any tax at source is only an estimate and so may not be the final amount due to HMRC – you may be due a refund or have a balance to pay. See How do I work out my tax? for more information.
You should note that from 2016/17, due to the personal savings allowance and the dividend allowance, most people will not need to pay tax on their savings interest or dividends. Both dividends and bank interest are paid gross (banks no longer automatically deduct tax from interest before it is paid, dividends no longer carry a 10% tax credit).
You may have been used to relying on the tax paid on your savings interest and the tax credit on your dividends to cover your Gift Aid donations.
If you no longer pay tax on them due to the new rules, but continue to donate to charity under a Gift Aid declaration, the charity will still assume the donation has come from someone paying tax and claim an amount back from HMRC. You might then be faced with a bill from HMRC for the amount the charity has claimed.
You may wish to cancel your Gift Aid declaration. You can still donate to charity, but the charity cannot claim Gift Aid relief from HMRC. You should also bear this in mind when visiting attractions which invite you to Gift Aid your ticket entry.
Look at the example Mr Green to see how this works.
You can also see from the Mr Green example that in previous years, the 10% dividend tax credit may have meant that you paid enough tax over the year to use Gift Aid, even if you were otherwise a non-taxpayer.
To work out if you have paid enough tax to cover your donations, divide the donation value by four and compare this figure to the amount of tax that you have paid for the year. Remember to add all the Gift Aid donations you have made in the tax year and that any tax at source is only an estimate and so may not be the final amount due to HMRC – you may be due a refund or have a balance to pay. See How do I work out my tax? for more information.
You should note that from 2016/17, due to the personal savings allowance and the dividend allowance, most people will not need to pay tax on their savings interest or dividends. Both dividends and bank interest are paid gross (banks no longer automatically deduct tax from interest before it is paid, dividends no longer carry a 10% tax credit).
You may have been used to relying on the tax paid on your savings interest and the tax credit on your dividends to cover your Gift Aid donations.
If you no longer pay tax on them due to the new rules, but continue to donate to charity under a Gift Aid declaration, the charity will still assume the donation has come from someone paying tax and claim an amount back from HMRC. You might then be faced with a bill from HMRC for the amount the charity has claimed.
You may wish to cancel your Gift Aid declaration. You can still donate to charity, but the charity cannot claim Gift Aid relief from HMRC. You should also bear this in mind when visiting attractions which invite you to Gift Aid your ticket entry.
Look at the example Mr Green to see how this works.
You can also see from the Mr Green example that in previous years, the 10% dividend tax credit may have meant that you paid enough tax over the year to use Gift Aid, even if you were otherwise a non-taxpayer.
your income really is less than £10 000 a year?
suppose it is - - then leave it
they do it as far as I can see ( since I have used Gift Aid every years for the last twenty years) thro the tax office - they check internally to see if you are a tax payer - and if the answer is no then the charity doesnt get the uplift
no adjustment is needed and I suggest you DON;T offer it -
the tax gift is not bad for the charity - for every £75 donated then they get another £25 - ( another third)
suppose it is - - then leave it
they do it as far as I can see ( since I have used Gift Aid every years for the last twenty years) thro the tax office - they check internally to see if you are a tax payer - and if the answer is no then the charity doesnt get the uplift
no adjustment is needed and I suggest you DON;T offer it -
the tax gift is not bad for the charity - for every £75 donated then they get another £25 - ( another third)
// ery little 45 quid on an 180 donation//
no - £60 ( a third)
hundred knicker gross you pay the govt 25 tax and pocket 75 ( 25%)
then you give the 75 to a charity and they get the 25 of tax
of a hundred nicker attracts £33 tax relief (1/3)
and yes you will notice that if the tax rate is 25% then when you gross it up you use 33% to get from nett to gross
I failed my accountancy exams
no - £60 ( a third)
hundred knicker gross you pay the govt 25 tax and pocket 75 ( 25%)
then you give the 75 to a charity and they get the 25 of tax
of a hundred nicker attracts £33 tax relief (1/3)
and yes you will notice that if the tax rate is 25% then when you gross it up you use 33% to get from nett to gross
I failed my accountancy exams
^^^ PeterP - the current state pension is £9,110 pa and the personal tax allowance is £12,500 pa,
You question whether earnings are below £10,000?
To clarify, gift aid is worth 25% of the first £100 donated and 30% of the next £101 to £2500.
On £180 gift aid is £25 + 30% of £80 (£24) = £49
My advice Weecalf is to contact the charity and explain that you are no longer a tax payer and would like to cancel your gift aid declaration. Don't worry about anything already claimed, its a small sum in the greater scheme of things.
You question whether earnings are below £10,000?
To clarify, gift aid is worth 25% of the first £100 donated and 30% of the next £101 to £2500.
On £180 gift aid is £25 + 30% of £80 (£24) = £49
My advice Weecalf is to contact the charity and explain that you are no longer a tax payer and would like to cancel your gift aid declaration. Don't worry about anything already claimed, its a small sum in the greater scheme of things.
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