Reducing your tax bill through charitable giving & key November tax dates
Giving to charity attracts a series of generous tax breaks that you can take advantage of. These breaks can positively affect inheritance tax, income tax as well as capital gains.
There are many amazing and deserving charities in Sussex and the South East which run purely on the goodwill of their volunteers and donations from the public. You can help those charities by giving, while at the same time getting tax relief on the donation.
Donating through Gift Aid means charities and community amateur sports clubs can claim an extra 25p for every £1 you give. It won’t cost you any extra. You benefit from a reduction in your tax bill if you are a 40% or 45% taxpayer – all you have to do is keep a record of your donations and then make the appropriate claim on your tax return.
For a 40% taxpayer, the relief is the same as the charity top-up – 25% of the sum given (so a cash donation of £100 results in a £25 reduction in your tax liability).
Gift Aid is typically associated with donations of money, these days often made online. However, some charity shops now offer arrangements where you can gift the proceeds of selling your unwanted items and the relief applies in the same way. Admission fees for zoos and heritage attractions often also qualify.
Donating straight from your wages or pension
If your employer, company or personal pension provider runs a Payroll Giving scheme, you can donate straight from your wages or pension. This happens before tax is deducted from your income.
You can’t donate to a community amateur sports club (CASC) through Payroll Giving and the tax relief you get depends on the rate of tax that you pay.
To donate £1, you pay:
- 80p if you’re a lower rate taxpayer
- 60p if you’re a higher rate taxpayer
- 55p if you’re an additional rate taxpayer
Donating land, property or shares
You don’t have to pay tax on the disposal of land, property or shares when you donate them to a charity. This includes selling them for less than their market value.
You get tax relief on both:
- Income tax
- Capital gains tax
You can’t claim income tax relief on donations to community amateur sports clubs (CASCs).
You must keep records of the donation to show that you’ve made the gift or sale and that the charity has accepted it.
Leaving gifts to charity in your will
You can donate your money, property and possessions to charitable organisations.
Your donation will either:
- Be taken from the value of your estate before inheritance tax is calculated
- Reduce your inheritance tax rate, if more than 10% of your estate is left to charity
You can donate:
- A fixed amount
- An item
- What’s left after other gifts have been given out
If you are interested in learning more about how to reduce your tax bill through charitable giving in Sussex & the South East, get in touch with Robin Stevenson our tax partner who can offer you some guidance on the best strategy to take
Tel: 01825 763 366
Key Tax dates for November 2017
|1||Corporation tax due for small companies with a 31 January 2017 year end.|
|7||Deadline for HMRC to receive online VAT returns and electronic payment for September quarterend and monthly VAT returns declaring a net payment due.|
|7||Normal Capital Goods Scheme adjustment for VAT year ending March 2017.|
|14||Instalment of corporation tax due for large companies with, 31 July 2017, 31 October 2017, 31 January 2018 and 30 April 2018 year ends.|
|14||Deadline for submission of monthly paper EC Sales List for October.|
|21||Deadline for submission of monthly electronic EC Sales lists for October.|
|21||Deadline for the submission of Intrastat returns for the month of October.|
|22||Cleared electronic payment of November PAYE due.|
|30||Deadline for submission of corporation tax returns for companies with a 30 November 2016 year end.|
|30||Deadline for submission of October quarter end and monthly VAT returns claiming a refund or nil payment of VAT.|
|30||Final date for reclaim of tax paid on loan to participator if loan repaid during APE 30 November 2013.|
The Chancellor announces the Autumn Statement. What does it mean for you?
The Chancellor Jeremy Hunt, has presented his Autumn Statement which he says is focused on growing the economy through reducing debt, cutting taxes and rewarding work. He stated that, ‘Our plan for the British economy is working, but the work is not done.’ This article will provide a summary of the measures announced. Do look out for a full report that will be sent to our newsletter subscribers in the coming days.
A guide to capital gains tax exemptions and the family home
A valuable relief exists on the sale of the family home, but in certain situations careful planning is required to ensure that the relief is obtained. The capital gains tax (CGT) exemption for gains made on the sale of your home is one of the most valuable reliefs from which many people benefit during their lifetime. In this article we look at the operation of the relief and consider factors that may cause it to be restricted.
Sign up to receive our private content
straight to your inbox