Against a background of growing fiscal pressure, the Chancellor delivered a Budget aimed at “putting the public finances on a sustainable path”. Whilst Income Tax thresholds and employee National Insurance contributions were left unchanged, the Budget contained various changes to Capital Gains Tax (CGT) and Inheritance Tax (IHT) which provide further incentives for your supporters to make non-cash gifts and consider charitable legacies.
Are you ready to accept gifts of shares?
The rates of CGT on share sales and other non-residential property assets were increased from 10% and 20% to 18% and 24%. In combination with the reduction in the Annual Exempt Amount (AEA) from £12,300 in 2022-2023 to £3,000 in 2024-2025, this rate uplift means that those selling shares face a significantly increased tax burden.
Example: Carol, who is a higher rate taxpayer, buys listed shares for £20k and later sells them for £40k, making a capital gain of £20k.
If Carol had sold the shares on 6 April 2022, she would have deducted her AEA of £12,300 and paid tax at 20% of £7,700, leaving a CGT bill of £1,540.
If Carol had sold the shares on 6 April 2024, she would have deducted her AEA of £3,000 and paid tax at 20% of £17,000, leaving a CGT bill of £3,400.
If Carol sells the shares on or after 30 October 2024, she will deduct her AEA of £3,000 and pay tax at 24% of £17,000, leaving a CGT bill of £4,080.
If your supporters own shares which are standing at a gain, they may wish to use these shares to fund their giving. A gift of shares to charity is exempt from CGT and, if the shares are a qualifying investment, the donor can deduct the market value of the shares from their taxable income, achieving Income Tax relief at their marginal rate.
Example: As above, but Carol gives the shares to charity. Carol pays no CGT on the gain and can deduct £40k from her taxable income, achieving Income Tax relief of £16,000 at her marginal rate of 40%.
If you’re not already set up to receive share gifts, don’t panic! Stewardship can help to facilitate share gifts into your Partner Account using a simple exchange of letters process with the donor. For more information, please contact us [email protected].
Might your donors be considering the sale of a business?
Investors’ Relief and Business Asset Disposal Relief offer a lower rate of CGT for investors disposing of shares in unlisted trading companies or individuals disposing of their own business.
This special CGT rate is currently 10%, but it will rise to 14% from 6 April 2025 and match the main lower CGT rate of 18% from 6 April 2026. The lifetime limit for Investors’ Relief has also been reduced from £10m to £1m with immediate effect.
If your donors include small to medium sized enterprise owners or investors, the upcoming tax rate increases may have caused them to consider a business exit. If so, we’d love to help your donors take this opportunity to set aside part of the proceeds in a Stewardship Donor Advised Fund or Philanthropy Fund to fund their future giving to your church and other charities. We’ll even be able to claim Gift Aid on the donor’s gift of sale proceeds and so reclaim some or all of the CGT the donor will pay on their business exit. For more information, please contact us [email protected].
Are you promoting legacy giving?
The IHT Nil Rate Band (tax-free amount) has been frozen at £325,000 since 2009 and this freeze has now been extended until 2030. The Chancellor also announced changes to Agricultural and Business Property Relief, making these reliefs less generous from April 2026. Perhaps most surprisingly, unused pension funds and death benefits will be brought into the scope of IHT from 6 April 2027.
The combined impact of these changes is that many more estates will be brought into the scope of IHT or will face higher IHT bills. This means that your donors will have even more incentive to consider a tax-free legacy to your charity. Now would be a great time to consider promoting gifts in wills. Not sure where to start? Why not read our blog: Legacies - could your church or charity benefit?.
For a version of this blog addressed to your supporters, see: Autumn Budget 2024 - what's the impact for givers?.
Stewardship may provide general guidance about charitable giving for information purposes only. We do not offer tax, legal or investment advice and you are encouraged to seek advice from a qualified professional on your specific situation.
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Quarterly emails for trustees, treasurers and Church and Charity Leaders. Practical tools, technical resources and expert guidance to safeguard your mission and ministry.
Rachel Steeden
Rachel is a solicitor with 17 years’ experience advising private clients and charities. She enjoys working closely with clients and their advisers to help donors make complex gifts effectively and tax-efficiently.
She is a member of the Charity Law Association, STEP Special Interest Group for Philanthropy, Lawyers in Charities and Lawyers’ Christian Fellowship. She is also on CityWealth's prestigious Top 10 Philanthropy Advisors 2024 list.
Rachel and her husband Derek lead a Bible study group at their church in central London.
They’re passionate about Church Planting in the UK and overseas, Bible translation and The Local Church.
