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how can we get more people to Gift Aid? Changes are afoot!

By Kevin Russell | 9 December 2014 | Comments (1)

Image by 7603557@N08 on Flickr, used under Creative Commons

Stewardship and other representative bodies have been working with HMRC on ways to increase the take up of Gift Aid. This has lead to HMRC commissioning independent research on, amongst other things, the wording of the Gift Aid Declaration as well as looking into the behavioural aspects that lead donors to sign, or not sign, a Gift Aid Declaration.


One of the outcomes is that the HMRC Model Gift Aid Declaration wording is likely to change, possibly as soon as April 2015. It is expected that the new Declaration will be much shorter and will drop references to council tax and VAT amongst other things. Stewardship has reviewed an early draft revised Declaration and very much supports the proposed changes.


These changes were trailed in the publication of the outcome of the research Gift Aid – Understanding Donor Behaviour. The research was commissioned as part of the HMRC Gift Aid Working Group, which was set up earlier this year to look at reform of the Gift Aid Declaration and changes to the way intermediaries operate Gift Aid, following the Gift Aid and Digital Giving Consultation in summer 2013.


Key findings from the research


Understanding Gift Aid

Participants generally knew that Gift Aid involves the Government ‘topping up’ donations made to charities, although understanding of how this worked in practice was generally poor, with the link to individual tax seldom made. Some respondents held deeper misconceptions, including the notion that Gift Aid was an additional tax or donation from them. Donors’ understanding of Gift Aid had a significant effect on decisions about whether or not to claim it.


Reasons for claiming and not claiming


Participants tended to claim Gift Aid if they believed themselves to be eligible, did not feel that claiming would incur any costs to themselves or the charity, and felt that the benefits to the charity outweighed the effort of claiming Gift Aid. Most knew Gift Aid benefits charities, and were claiming Gift Aid most or all of the time as they felt this was the ‘right’ thing to do – including some who were ineligible as they were not paying any/enough tax, but had not make the link between ‘taxpayer’ and the need to have paid tax. However, some who were eligible to claim were not doing so: they believed there to be a cost to the charity or themselves; they were deterred by a practical barrier such as unwillingness to share personal information with charities in case they were re-contacted for fundraising; a reluctance to participate in anything ‘official’, or a general view of form-filling as inconvenient.


The influence of habit


Though the factors outlined above influenced conscious decisions about Gift Aid, the research indicated that donors did not deliberate about Gift Aid every time they donated. Rather, donors’ choices were often automatic, following a previous decision they had made about whether or not to claim. Over time this choice had become habitual and unthinking, so that they did not read information or engage consciously with the question of whether or not to claim. Disrupting this habitual process with up-front ‘priming’ messages highlighting the benefits of Gift Aid was received positively by participants.


Views on Gift Aid Declarations


This research suggests some key information the Gift Aid Declaration (GAD) needs to

communicate (in particular the link to tax paid, the reason for asking for an address, and the fact it is the donor’s responsibility to ensure that enough tax has been paid) to allow donors to assess their eligibility and to overcome misconceptions. Breaking information up into tick-box bullets seemed an effective way to communicate content that otherwise risked being seen as too detailed and ignored. The tick box encouraged donors to read and take the content seriously as it implied that they were actively agreeing to something, as well as flagging something different about the scheme – although four tick boxes was felt to be too many, whilst one did not provide enough detail to enable participants to determine their eligibility.

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Posted by Kevin Russell

Our Legal Eagle guru and Stewardship's Technical Director, Kevin constantly has his finger on the pulse of all things tax and charity law-related. His briefing papers for charities, churches and individuals are an invaluable resource on everything from VAT to Gift Aid. 


Annette Adams

July 23, 2015 3:19 PM
Dear Sirs,

Recent Budget Changes
Will the increase in Income Tax Personal Allowances have a negative effect on the amount of Gift Aid which Charitable Causes can claim back from the Tax Man? As an increasing number of pensioners will pay little or no Income Tax, I consider that the amount of Gift Aid paid out by HMRC will go down. I doubt very much that those taken out of Income Tax will increase their donation by 25% to make up for the Gift Aid.

Yours faithfully

Annette Adams

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