UK Charitable Donations - Tax Deductible?

[pagingdoris]

Hi to everyone,

I have a question which I'm hoping someone can clarify.

In a BBC article from 2012 it is stated that: "When higher rate taxpayers donate money to charity, some of the tax can be reclaimed. Effectively they could pay no tax at all, if they choose to give away their income to charities."

As far as I can tell this is just wrong. For any individual, donations to charities can only be deducted if they are wholly and exclusively for their business (e.g. for a sole trader) and gift aid only lets the sole trader deduct the difference in rates between the basic rate and their higher rate.

So how are all these "wealthy individuals" exactly reducing their tax bills so much according to these BBC articles?

http://www.bbc.com/news/uk-politics-17664893

http://www.bbc.com/news/uk-politics-18278253

http://www.bbc.com/news/business-17754809

Obviously having a limited company is different but I don't think this article is referring to that!

Am I missing something here?

 

[Becky]

Welcome to the forum! There is more information here:

https://www.gov.uk/donating-to-charity/overview
https://www.gov.uk/government/publi...ssment-helpsheet/hs342-charitable-giving-2015

 

[cooper1210]

Everyone that donates through "Gift Aid" is presumed to have paid basic rate tax. Higher Rate taxpayers get a small credit if they donate for the extra tax that they pay. Overall, they are still paying into charity, but they're effectively get 40% tax relief.

 

[Idrees]

As an employee you can give donations to charities via Payroll Giving scheme and can benefit same as businesses