Gift Aid

[woofgang]

I understand that you can only use gift aid to increase charitable donations up to the total of the tax that you pay in a year. What happens if you exceed that limit? Does the donor have to keep track of how much they gift aid or does the Tax office do it? If you do exceed the allowance, how is who gets the gift aid decided?
Thanks

[rockyracoon]

I think the tax man comes after the donor for the difference. I'll see if I can find my paperwork on it.

[rockyracoon]

From HMRC

Making sure you’ve paid enough tax to use Gift Aid
You can use Gift Aid if the amount of Income Tax and/or Capital Gains Tax you’ve paid for the tax year in which you make your donation is at least equal to the amount of basic rate tax the charity or CASC and any other charities or CASCs you donate to will reclaim on your gift. A tax year runs from 6 April one year to 5 April the next. If you make a number of Gift Aid donations, you will need to consider the tax you’ve paid on each donation on an accumulative basis. If you don’t pay enough tax you will need to pay any shortfall in tax to HMRC.
You don’t necessarily have to be working to be paying tax. Apart from tax on income from a job or self-employment, the tax you’ve paid could include:
tax deducted at source from savings interest
tax on State Pension and/or other pensions
tax on investment or rental income (including tax credits on UK dividends)
Capital Gains Tax on gains
Other taxes such as VAT and Council tax do not qualify, nor does any non-UK tax.
How to check if you’ve paid enough tax
To work out if you’ve paid enough tax to cover your donations, divide the donation value by four. For example, if you give £100 in a particular tax year you will need to have paid £25 tax over that period. (£100/4 = £25). (Note that this calculation is based on the basic rate tax of 20 per cent)
If you don’t think you've paid enough tax this year, you may be able to carry back your donation to the previous tax year. See the later section 'Carrying back Gift Aid donations to the previous tax year'

[woofgang]

thank you...I thought there would be a catch....

[rockyracoon]

Lol, isn't there always!

[Maydup]

In reality, HMRC don't have the recourses to track and trace more than a handful of spot checked gift aid donations across the millions of pounds given to all charities each year.

Take a deep breath for last year and don't tick the gift aid box anymore if you are a non tax payer.

[woofgang]

Thanks maydup, the story is a little different from that. Last year my financial circs were complicated so I wanted to keep my tax return as simple as possible, so I didn't gift aid any donations. This year things will be simpler is I am considering what I want to do.