Shouldn’t charity begin at home?

‘I can’t give it away’ says city trader Dan

There has been much debate in 2012 about whether giving money to charity is tax avoidance or not, after George Osborne’s announcement in the March budget and his subsequent U-turn.

For the vast majority the Gift Aid rules on giving to charity are a sensible and appropriate incentive to donate. But there have been marketed schemes that have abused them.

For example, a tax adviser has gone to prison for selling a scheme that over claimed Gift Aid relief. The scheme did this by substantially and artificially increasing the value of shares bought by people in the scheme.

People like Dan then gifted those shares to charities and claimed back more Gift Aid relief on that gift of shares than they’d paid for the shares in the first place.

Other schemes abusing Gift Aid are now coming to light.