Gift Aid is once again in the public eye, with the Government reporting earlier this year that around £600m of potential Gift Aid goes unclaimed each year, while around £179m is claimed in error by individuals who may not understand how the benefit should work.
Add to that the latest government challenge by Exchequer Secretary to the Treasury Robert Jenrick MP, who is pushing for Gift Aid to be passed on in full by online fundraising intermediaries, and Gift Aid remains firmly in the headlines as a valuable source of charitable income.
As the UK becomes increasingly digital, with card and mobile payments exceeding cash transactions for the first time in 2015, it is essential that charities are aware of this growing opportunity. Embedding a Gift Aid declaration in an online donation journey is much easier than asking harassed parents to sign a Gift Aid declaration when they are trying to pay entry for a day out at a local National Trust site, surrounded by their kids!
Innovations in the digital world have seen online donations grow in ways we could only have imagined a few years ago with Guide Dogs for the Blind recently running a “tap to pat” initiative and contactless buckets (where you tap instead of drop coins). Not only is using technology safer than cash and less of an administrative headache but the potential value of the donations themselves is likely to be higher. The challenge lies in embedding a Gift Aid process into these new donation journeys. Any online retailer will tell you that the skill in maximising sales is to make the journey as frictionless as possible, and the same principle undoubtedly applies to encouraging (accurate) Gift Aid claiming by eligible donors
Gift Aid uptake in the UK remains at around 52%, but varies dramatically by donation channel, with cash being the lowest and online intermediary fundraising channels one of the highest. The challenge and opportunity for charities is to grow their uptake across all channels, and to build ongoing relationships with their fundraisers, donors and supporters to maximise the benefit that Gift Aid offers. This will require on-going education and awareness and the Charity Finance Group Gift Aid Awareness day on 4 October 2018 is a great way to make progress.
At a time of on-going economic challenge, and some evidence that charitable giving is potentially stagnating, it is more important than ever that charities seek to maximise revenue from this tax benefit, encouraging their donors to tick for Gift Aid in all appropriate donations.
Sara Vening will be speaking at Gift Aid Conference in Birmingham 12 September. She will be covering the topic 'Online giving and intermediaries' find out more and book.
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