In this section:
If you're a sole trader (self-employed) or a partner in a partnership, you pay Income Tax as an individual on your business profits. So you can take advantage of the tax reliefs on gifts of money to charity that are available to individuals and can claim them on your Self Assessment tax return.
If you give money to a charity or a Community Amateur Sports Club (CASC), you can use Gift Aid. This increases the value of your donation to the charity or CASC by allowing them to reclaim basic rate tax on your gift. If you pay higher rate tax you can claim extra relief on your donations. You can’t deduct the donation from the total profits of your business when calculating the tax chargeable on your profits.
This guide explains how sole traders and partnerships can make gifts of money to charities using Gift Aid. It also links to information on how they can make other sorts of donation.
On this page:
All gifts of money that sole traders make to charity through Gift Aid are treated in the same way as gifts from any other individuals. So the normal Gift Aid rules apply.
In order to make a Gift Aid donation you'll need to make a Gift Aid declaration. The charity will normally ask you to complete a simple form - one form can cover every gift made to the same charity or CASC for whatever period you choose, and can cover gifts you have already made and/or gifts you may make in the future.
A Gift Aid declaration must include:
If they have the power to do so under the terms of the partnership agreement, one partner can make a single Gift Aid declaration on behalf of all the partners. And the declaration only needs to show the name and address of the partnership.
If they're not able to do this, each partner has to make their own Gift Aid declaration. This can be done on a single form as long as it includes each partner's name and home address.
In Scotland, a partnership does have a legal personality. So one partner can always make a declaration on behalf of the partnership, showing the name and address of the partnership.
Each partner should enter their share of the donation on their own tax return. How you split the donation between you is up to you. For example, you might decide to split it:
Although Gift Aid only applies to gifts of money, sole traders and partnerships can also get tax relief on gifts to charities of:
For more help you can contact the Charities Helpline.