Not strictly true. For individuals, the costs of making a £100 cash donation without gift aid are £100 gross, £100 net. When UK basic rate income tax is 20%, the costs to the donor of making that same donation with gift aid are £125 gross and anything between £125 and £68.75 net, depending on the top rate of tax of the donor making that donation. This is because gift aid is not a Government gift to the charities as they like to claim. For individuals it is instead a personal UK income / capital gains tax relief, that is provisionally given to that donor by allowing that donor to deduct basic rate income tax from the gross amount of that gift at its point of payment , so in the present example £125 less 20% of £125 equals £100. The charities are happy enough to claim that this means that it costs the donor no extra to make a charitable donation with gift aid than it does without gift aid , but, as the charities well know, that is apples and pears accounting and no less disgraceful for being how they mostly sell gift aid to a public gullible enough to believe in Magic Money Trees. Bottom lime is that donors taking more tax from their gross gift aid donations [as their gift aid tax relief] than they pay UK income tax and /or capital gains tax are liable to be billed by HMRC for the difference. The cost to the Exchequer of giving tax relief to gift aid donors is currently in the region of £2.3 billion pounds a year. Any charity that claims that it receives no help from the State is either lying or managed by trustees who are not up to their jobs.
Not strictly true. For individuals, the costs of making a £100 cash donation without gift aid are £100 gross, £100 net. When UK basic rate income tax is 20%, the costs to the donor of making that same donation with gift aid are £125 gross and anything between £125 and £68.75 net, depending on the top rate of tax of the donor making that donation. This is because gift aid is not a Government gift to the charities as they like to claim. For individuals it is instead a personal UK income / capital gains tax relief, that is provisionally given to that donor by allowing that donor to deduct basic rate income tax from the gross amount of that gift at its point of payment , so in the present example £125 less 20% of £125 equals £100. The charities are happy enough to claim that this means that it costs the donor no extra to make a charitable donation with gift aid than it does without gift aid , but, as the charities well know, that is apples and pears accounting and no less disgraceful for being how they mostly sell gift aid to a public gullible enough to believe in Magic Money Trees. Bottom lime is that donors taking more tax from their gross gift aid donations [as their gift aid tax relief] than they pay UK income tax and /or capital gains tax are liable to be billed by HMRC for the difference. The cost to the Exchequer of giving tax relief to gift aid donors is currently in the region of £2.3 billion pounds a year. Any charity that claims that it receives no help from the State is either lying or managed by trustees who are not up to their jobs.