CIOT: Minister welcomes Fanning Report on Gift Aid
The Economic Secretary to the Treasury, Justine Greening MP, has responded positively to the Fanning Report on Gift Aid, produced by the Chartered Institute of Taxation (CIOT) Chief Executive, Peter Fanning, which sets out a number of recommendations coming out of the work of the Gift Aid Forum1, of which he was a member.
In a letter to Mr Fanning, also published on the Treasury website, the Minister says there is much in his report that can be taken forward, and that that HMRC will be setting up a Charity Tax Forum, which will progress some of the recommendations.
Peter Fanning commented:
“I thank the Minister for her positive response to my report. Gift Aid should be seen as a success – it delivers over a billion pounds extra per year for charities. But with a concerted effort from government, charities and tax professionals it could raise even more.”
Three of the key recommendations from the report are:
. Getting more donors giving using Gift Aid
Data in the report show that too many donors fail to take advantage of Gift Aid2. The report recommends government and charities develop a joint programme to promote charitable giving, including explanation and promotion of Gift Aid. The Minister’s response recognises this need.
Peter Fanning commented:
“There is clearly huge potential for increasing the take up of Gift Aid by promoting its availability and making it easier for people to claim it.”
. Getting more charities using Gift Aid
Only around 68,000 of the 160,000+ charities claim Gift Aid; many other sports clubs and other bodies3 are also eligible.
Peter Fanning commented:
“Many small charities and local sports clubs are put off by what they see as a complex and administratively burdensome process. I welcome the Minister’s announcement that HMRC will move quickly to improve guidance to charities. Online filing of Gift Aid claims and a Gift Aid database also need to be explored.”
. Harnessing the skills of tax professionals
The Fanning Report recommends that ministers explore with the tax profession how tax professionals might donate their skills and time to help charities comply with and benefit from Gift Aid.
Peter Fanning commented:
“Many tax advisers already donate time and skill to helping and advising individual unrepresented taxpayers4 and small charities or sports clubs. I look forward to discussing with the Economic Secretary how we can encourage more tax professionals to join them and help more organisations make the most of Gift Aid.”
Notes to Editors
1. Peter Fanning produced the report on the work of the Government’s Gift Aid Forum, of which he was a member, at the request of the Economic Secretary to the Treasury. The Forum met on six occasions between February and November 2010. A list of organisations represented on the Forum is available on the Treasury website. While the report has been produced in a personal capacity, Mr Fanning has sought to ensure that so far as possible it reflects the views of a majority of Forum members.
The Charity Commission reports that in 2010 the total income of registered charities was approximately £52.5 billion, which means that Gift Aid donations account for approximately 8.6% of the aggregate income of the charities sector.
In addition to 168,000 registered charities there are tens of thousands of organisations that have either ‘excepted or exempt’ status and so are not registered with the Charity Commission but are nevertheless eligible for tax reliefs. Such organisations include churches, higher education establishments, museums, galleries. Community amateur sports clubs are also eligible to claim Gift Aid but are not charities.
4. Notably the charity TaxAid supports those in tax debt, and Tax Volunteers provides Tax help for Older People (TOP). Tax Volunteers includes around 700 CIOT members who provide support pro bono. Additionally the Low Incomes Tax Reform Group (LITRG), an initiative of the CIOT, produces guides for unrepresented taxpayers to help them deal with their tax affairs, as well as working to improve the policy and processes of the tax, tax credits and associated welfare systems for the benefit of those on low incomes.
5. You can download the report and other relevant documents from the HM Treasury website:
Justine Greening’s letter to Peter Fanning regarding his Gift Aid report
Peter Fanning’s letter to Justine Greening regarding his Gift Aid report
Gift Aid Forum report
6. The Chartered Institute of Taxation (CIOT) is a charity and the leading professional body in the United Kingdom concerned solely with taxation. The CIOT’s primary purpose is to promote education and study of the administration and practice of taxation. One of the key aims is to achieve a better, more efficient, tax system for all affected by it – taxpayers, advisers and the authorities.
The CIOT’s 15,000 members have the practising title of ‘Chartered Tax Adviser’ and the designatory letters ‘CTA’.
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George Crozier
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The Chartered Institute of Taxation
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The Association of Taxation Technicians
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