Charities often encourage donations by giving a small reward to their donors. This could be anything from stickers and keyrings to teddy bears. Where the reward is more than a token value, this needs to be measured and assessed against value thresholds to make sure that gift aid can still be claimed. The benefit value thresholds have been simplified slightly from 6 April 2019, reducing the thresholds from three to two. The new limits will be:
• For donations up to £100: 25% of the value of the gift (as before)
• Donations over £100: £25 plus 5% of the excess over £100
• Maximum annual benefit £2,500 (as before)
The Gift Aid Small Donations Scheme (SDS) allows charities to claim a gift aid type benefit of 25% of donations without requiring a personal declaration. Until now, the maximum donation under SDS has been £20. This limit will increase in April to £30.
The Gift Aid Small Donations Scheme helps charities who undertake impromptu small donations, eg from bucket collection. The increase in the limit also now aligns the limit with the maximum contactless payment allowing charities to take full advantage of this type of giving.