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Before your charity or Community Amateur Sports Club (CASC) can claim tax back on a donation made by an individual, you need to obtain a Gift Aid declaration from that donor.
A Gift Aid declaration can be made in writing, electronically or verbally, and must contain certain information about the donor. You also need to show that you have advised the donor that they will need to pay sufficient UK tax at least equal to the amount that your charity or CASC will reclaim on their donation(s).
You must keep these records in support of your Gift Aid repayment claims. Each donation included in a claim must be supported by a Gift Aid declaration.
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There is no set design for a Gift Aid declaration. However, by law, any Gift Aid declaration you receive (whether written or verbal) must contain the following information:
Gift Aid declarations can be worded so that they apply to:
Declarations that include all future donations are known as enduring declarations. Donors need to understand that they must pay at least as much UK Income Tax and/or Capital Gains Tax (in the year in which they donate) as the amount that will be claimed by your charity or CASC. So it's a good idea to state this clearly on your Gift Aid declaration.
HM Revenue & Customs (HMRC) doesn't require you to use an official Gift Aid declaration form, but does have a model Gift Aid declaration form that you can use and adapt to suit your needs. Your charity or CASC may want to add additional information such as data protection disclaimers or bank mandate details.
Go to the Gift Aid declaration form
Gift Aid declarations can be made in writing either on paper or electronically, for example on the Internet, or by email, fax, mobile phone or text message. They can also be made verbally - in person or by telephone. There's a different procedure for declarations relating to donations for sponsored events. See later section on 'Declarations linked to sponsored events'.
Most charities use a written declaration based on the HMRC model declaration.
A declaration can also be pre-printed on a collection envelope used
in church services and for house to house collections.
An electronic declaration made on a charity's website is accepted as
a written form of declaration. Your charity or CASC should ask donors
to provide the same name and home address details as required on a written
declaration.
The information provided by the donor on their declaration can then be stored electronically. The website should also contain a note, or statement to the donor, about the need to pay sufficient UK tax to cover any repayment claimed by your charity on the donation(s) specified in the declaration. This must be clear and visible when the donor is completing their Gift Aid declaration online.
Your charity or CASC may choose to keep an audible (and auditable) record of all verbal Gift Aid declarations.
If you don't keep audible recordings of verbal declarations, you must send the donor a written confirmation of their declaration which:
A verbal declaration is not effective until you send this written confirmation to the donor. If the donor cancels the declaration within the 30 days allowed, any tax you have already reclaimed must be repaid to HMRC.
You must keep records of written confirmations issued, and any cancellations received. These records can be kept electronically.
Spouses and people living at the same address can make a joint declaration, in effect making two or more Gift Aid declarations on the same form. The declaration must include the full name and address of each person. Joint payments should be split equally between the donors unless both parties tell your charity or CASC how they want their payments to be split. They should also keep this information for their own tax records.
Your charity or CASC will need to list each donor separately on the R68(i) Gift Aid form that you fill in as part of your tax repayment claim, and show the proportion of the donation from each of the joint donors.
How to fill in the R68(i) Gift Aid form
A donation by a business partnership is treated as being made by all the underlying partners. One partner may make a Gift Aid declaration on behalf of all the partners, provided they have the power to do so under the terms of the partnership agreement or another document that specifically allows it. In this case it will be sufficient for the declaration to show the name and address of the partnership. Otherwise, it will be necessary for each partner to make their own Gift Aid declaration. They may do so on the same declaration form, provided it lists all their names and home addresses.
Limited Liability Partnerships (LLPs) and all partnerships in Scotland have a legal personality. This means that one partner can make a Gift Aid declaration on behalf of the partnership. The declaration must show the name and address of the partnership.
The partners should enter their share of the donation on their own Self Assessment tax return. They should decide between themselves how the donation is split.
Find out more about Gift Aid record keeping and audit requirements
To save time and help your record keeping, your charity or CASC can design a sponsorship form that can also be used as a Gift Aid declaration form. You could add the Gift Aid declaration at the top of the sponsor form, and add an extra column so that each sponsor can choose to have their sponsorship money paid to your charity or CASC as a Gift Aid donation by ticking a box. The form should include the following information:
Use the model Gift Aid sponsored event form
Your charity or CASC can decide how best to store your Gift Aid declarations, but your records must clearly show that each donor included in your repayment claim has made a declaration.
Declarations must be made available for review if required by HMRC.
Paper declarations can be kept in their original format. Or they can be scanned and stored electronically, as long as the records can be searched and individual declarations located as required. If you keep scanned copies which are fully auditable you can destroy the originals.
Transcription onto a separate list or database is not an acceptable alternative to keeping the original declarations, or scanned copies.
Records of donors who have made a declaration electronically, for example on a website, can be stored on a database.
If you use verbal declarations you could audio-record these in full at the time they are made. If you don't do this your charity or CASC must confirm the declaration in writing to the donor and be able to provide evidence of this correspondence.
If records are kept on computer, it is advisable to make regular backups and store them in more than one location.
The time limits for keeping Gift Aid declarations and Gift Aid payment records are different and depend on how your charity or CASC is treated for tax purposes. All CASCs and most charities will be treated as companies for tax purposes. You will only be treated as a trust if your charity was set up by a trust deed or a will.
If your charity is run as a charitable company - which most are - or you're a CASC, you must keep your tax records (including Gift Aid declarations and records) until the later of:
For example if a charitable company prepares its accounts to 31 December 2007 and makes a Gift Aid repayment claim for that period during 2008, it must keep the records until at least 31 December 2013. But if the charity waits until 2013 to make its repayment claim, it must keep the records until at least 31 December 2014.
If HMRC asks you questions about your tax return or repayment claim, you'll need to keep the records until the enquiries are finished.
A single Gift Aid declaration may apply to more than one donation, so you'll need to work out when the last gift specified on a particular declaration is received, and keep the declaration long enough to satisfy the rules set out above.
If you have any enduring Gift Aid declarations covering ongoing donations you'll need to keep them permanently.
As a general rule we recommend that you should keep your tax records (including Gift Aid declarations and records) until the later of:
If you are asked to make a tax return there are different rules about how long you must keep records for. For more information, see link below.
If HMRC asks you questions about your tax return or repayment claim, you'll need to keep the records until the enquiries are finished.
A single Gift Aid declaration may apply to more than one donation, so you'll need to work out when the last gift specified on a particular declaration is received, and keep the declaration long enough to satisfy the rules set out above.
If you have any enduring Gift Aid declarations covering ongoing donations you'll need to keep them permanently.
Record keeping if you're a charitable trust
A donor can cancel an enduring Gift Aid declaration at any time. For example a donor may cancel his declaration because he no longer pays any UK tax. Cancellation of a declaration will not affect Gift Aid donations that have already been made but once a declaration has been cancelled any further donations from that donor won't qualify for Gift Aid. Your charity or CASC must keep records of cancelled Gift Aid declarations, including the date of cancellation.
Written Gift Aid declarations relating to 'one off' gifts can't be cancelled once the gift has been made.
A verbal declaration can be cancelled by a donor within 30 days of a letter being sent by a Charity or CASC confirming the donor's verbal declaration.
For more help you can contact HMRC Charities
Read more about Gift Aid declarations in the detailed guidance notes
