Chapter 4 - Payroll Giving

4.4 Employees

How does an employee join the scheme?

4.4.1 An employee can join the scheme by asking their employer for an application form. This should be filled in and given back to the employer or sent directly to the agency charity depending on the particular arrangements of the scheme.

How does the employee get tax relief?

4.4.2 The gift to charity is deducted from earnings before they are taxed. So the employee gets relief at his highest rate of tax. But the gift does not reduce earnings for National Insurance Contributions purposes.

Which charities can employees support?

4.4.3 Donations can be given to any charity in the UK. Donations can be given to more than one charity or to a consortium made up of different charities.

How does an employee leave the scheme?

4.4.4 An employee can leave the scheme at any time by giving his employer reasonable notice.

Can donations be refunded?

4.4.5 Once a payment has been deducted from earnings and tax relief given the gift must go to the charity. The donation cannot be refunded.

Does the employer have to know which charity receives the donation?

4.4.6 No. It is not necessary for the employee to tell the employer which charity he intends to benefit. Requests can be forwarded directly to the agency charity. It is an important feature of the Payroll Giving scheme that an employee can keep his choice confidential if he wishes to do so.

Can the charity provide any benefits in return for donations?

4.4.7 No. If a charity provides benefits, for example free admission to properties or events, in return for donations the donations will not qualify for relief under Payroll Giving. However, we would not regard items of negligible value, for example newsletters or badges, as benefits for this purpose.