What Donor benefits are acceptable?

A basic principle underlying Gift Aid is that the gift should be freely given with nothing substantial expected or provided in return. The donor, and persons connected to the donor – most relatives and business partners, must not receive a substantial benefit in return for the donation.

However, some donor benefits can be ignored and there are monetary limits below which benefits are not considered ‘substantial’. If the benefit limits are breached, it may be possible to split the donor’s payment into a payment for the benefits and a donation, so that the donation element can be Gift Aided.

Benefits that can be ignored often will include charity literature, acknowledgements, naming rights, and unconnected third party-provided benefits. Minor benefits limits are 25% of the donation amount for donations up to £100, and for larger donations, £25 plus 5% of the donation amount over £100 up to a maximum benefit value of £2,500.

Want to discuss further?

Helen Elliott

Partner

Ross Palmer

Senior Tax Manager

Gillian McKay

Senior Tax Manager

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