Take Advantage of Gift Aid

If you pay UK tax, then by signing a simple declaration, JAGS is able to arrange for HM Revenue & Customs (HMRC) to pay to the School the tax you (or your company) will already have paid on the amount you (or your company) donate, plus a little more!

If you Gift Aid your donation, JAGS will receive an additional 28p for every £1 you give. JAGS can claim Gift Aid tax relief of 25p on every pound. Additionally, HMRC will be operating transitional provisions for Gift Aid donations made from 6 April 2008 until 5 April 2011, paying a Government supplement of 3p on every pound, making the total of 28p for every £1 donated.

By way of an example, a total payment of £3,000 by Gift Aid will be worth £3,840 to the School after tax recovery. Higher rate taxpayers can also claim tax relief for themselves: the actual cost to a higher rate tax payer of the gift of £3,000 would be £2,250 - further examples are given in the table overleaf.

Gifts of Shares

For UK taxpaying donors with investments, giving shares may be a very effective way to make a substantial gift because they can obtain generous relief on their income tax bill as well as exemption from Capital Gains Tax (CGT) on any gains they would have made on the shares.

What this means in practice is that if the shares have increased in value since they were purchased, the donor will not be taxed on that increase in value if the shares are given to a charity. In addition, the value of the shares at the date of transfer to the charity is eligible for income tax relief at the higher rate of tax. An example is given below.
 
Those considering a gift of shares are invited to contact the JAGS Development Office in the first instance.

Other Gifts

Capital Gains Tax does not attach to outright gifts of assets such as works of art or property. Additionally, all outright gifts (including bequests) are exempt from Inheritance Tax. If you are considering these matters, do please contact the JAGS Development Office in the first instance. 

Practical Examples of Gift Aid

This example relates to monthly gifts by an individual of a regular amount over three years:

This table relates to one-off gifts either by an individual paying higher rate tax or by a UK

* Basic rate tax at 20% plus HMRC transitional provision (see overleaf) and a higher rate of 40% (effective from April 2008).

The Advantages of Donating Shares

With the higher rate of income tax at 40% and capital gains tax at 18% (from April 2008), this can amount to a significant tax break. When a donor donates shares to a charity, there is no capital gain (or loss) for CGT purposes.

For example, you give JAGS shares worth £10,000 after 5th April 2008. The cost of the shares to you for capital gains tax purposes is £0. If you had sold the shares yourself, you would have received £10,000 but paid £1,800 capital gains tax (at 18% and assuming no annual exemption), and been left with £8,200. By giving the shares to JAGS instead, you would receive Capital Gains Tax relief of £1,800 (being 18% of £10,000), and Income Tax relief of £4,000 (being 40% of £10,000) making a total saving of tax of £5,800. This means that a gift with an effective after-tax cost to you of £4,200 would be worth £10,000 to JAGS.  The following Table might be helpful as a further illustration:

Make a Gift