Gifts of money to charity by sole traders or partnerships

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.

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Gifts of money from sole traders and partnerships

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.

Find out about giving to charity through Gift Aid

Gift Aid declarations

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:

  • your name - as a minimum the initial of your first name and your last name in full
  • your home address - as a minimum your house number/name and postcode
  • the name of the charity
  • details of your donation, and that Gift Aid is to apply- a tick box is sufficient on a written form or website
  • whether the declaration covers only the present donation or past and/or future donations as well
  • confirmation (either on the declaration or separately) that the charity has given you an explanation that you must pay at least as much UK Income Tax and/or Capital Gains Tax for the tax year as all the charities and CASCs that you donate to in that tax year can reclaim from HM Revenue & Customs (HMRC)

Partnership declarations - England, Wales and Northern Ireland

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.

Partnership declarations - Scotland

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:

  • in equal shares
  • in line with each partner's share of the partnership profits
  • in any other way that the partners have agreed on

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Making other gifts to charity

Although Gift Aid only applies to gifts of money, sole traders and partnerships can also get tax relief on gifts to charities of:

  • equipment
  • trading stock
  • the costs of 'secondment' of your employees - temporarily transferring them to work for a charity

Find out about gifts to charity of company equipment, trading stock or staff help

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Contacting the HMRC Charities Helpline

For more help you can contact the Charities Helpline.

Contact the Charities Helpline

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More useful links

Find out how your company can make gifts to charity

Find out about giving land, buildings or shares to charity from your company

Find out about sponsoring a charity

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