Gifts to charity of land, buildings or shares by individuals

If you give land, property or qualifying shares to a charity, or sell them to a charity at less than their market value, you can claim Income Tax relief and lower your tax bill, as well as getting Capital Gains Tax relief.

There is no Income Tax relief for gifts or sales of land, buildings and shares to Community Amateur Sports Clubs (CASCs), although gifts or sales to CASCs can qualify for relief from Capital Gains Tax.

On this page:

Income Tax relief

You can claim Income Tax relief on gifts (or sales below market value) to charity of:

  • Shares or securities which are listed on any recognised stock exchange. This includes London and Plus Listed in the UK and any recognised overseas stock exchange.
  • Shares or securities dealt in on any designated market in the UK. The only markets so designated currently are the Alternative Investment Market (AIM) of the London Stock Exchange and the PLUS-Quoted market of PLUS Markets.
  • Units in an Authorised Unit Trust (AUT).
  • Shares in a UK Open-Ended Investment Company (OEIC).
  • Holdings in certain foreign collective investment schemes - generally schemes set up outside the UK that are similar to AUTs and OEICs.
  • A qualifying interest in land in the UK.

Note that Income Tax relief is not available if you are giving land, property or shares to a CASC.

Find out which stock exchanges are recognised

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Capital Gains Tax relief

Capital Gains Tax is normally payable when land, buildings or shares - or any other asset other than money - is given away or sold at a profit.

However you’ll get relief from Capital Gains Tax when you:

  • give any asset to a charity or a CASC
  • sell any asset to a charity or CASC for less than its market value

When you give an asset away to a charity or CASC, or sell it to a charity or CASC for less than it cost you, you're treated as making no gain or loss for Capital Gains Tax purposes, so you won’t have to pay any Capital Gains Tax.

If you sell an asset to a charity or CASC for less than its market value but more than you originally paid for it, you should calculate the capital gain on the basis of the amount the charity actually pays you. You will only pay Capital Gains Tax if the selling price is more than the allowable costs.

Find out more about Capital Gains Tax exemption on gifts to charity

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How to give land, buildings or shares to a charity

First you need to contact your chosen charity to make sure it can accept your gift.

If you want to give shares you need to complete a stock transfer form to:

  • take the shares out of your name
  • put them into the charity's name

If you want to get Income Tax relief for giving land or property you must obtain a certificate from the charity. This must contain the following:

  • a description of the qualifying interest in land or property that has been given or sold to the charity
  • the date of the disposal
  • a statement confirming that the charity has acquired the qualifying interest in the land or property

A ‘qualifying interest’ means a freehold interest in land or a leasehold interest in land.

You must transfer the whole of your interest in that land or property to the charity. For example, you can't give your property to charity and continue to live in it. In the situation where two or more persons hold the property, all of the joint owners must dispose of their interest in the property to the charity at the same time if any of them are to claim relief.

A charity might ask you to sell the shares or land you propose to give on their behalf. You will need to keep evidence (such as an exchange of letters to show that you’ve made the gift and the charity has accepted it) before you dispose of the asset - otherwise you might have to pay Capital Gains Tax.

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Working out the Income Tax relief you can claim

The way you work out Income Tax relief is different depending on whether you give land, buildings or shares to a charity or sell them to charity at less than their market value.

Tax relief on a gift

To work out the amount of Income Tax relief you'll get for making a gift to a charity, add together the market value of the asset you're giving and any costs like legal fees. Then take away any money or other benefits you (or anybody connected with you) get for giving the asset to the charity.

Tax relief on a sale at less than market value

To work out the amount of Income Tax relief you'll get when you sell an asset to a charity at less than market value, add together the market value of the asset you're selling and any costs like legal fees. Then take away the amount you sell the asset for. After that take away any money or other benefits you (or anybody connected with you) get for selling the asset to the charity.

In both cases

In both cases you work out the amount of Income Tax relief you can get by deducting what's left from your total income, but not gains, for the tax year you make the gift. A tax year runs from 6 April one year to 5 April in the next. You can't carry the relief forward or backwards to any other tax year.

If you have given land or property to a charity your Income Tax relief could be affected if you again become entitled to any interest or right in relation to all or part of the land or property. There are special rules covering this.

Market value

The market value is the price that the asset might reasonably be expected to sell for in an open market.

If you're giving or selling land or property you should value it on the date you transfer it to the charity. It's likely that you'll need to engage a professional adviser to work out the market value. You can add those costs to the market value when you work out your tax relief.

There are different rules for working out the market value of shares and securities or other investments. There are also different rules for calculating the relief if the charity has to do something in return for receiving the asset or if the asset was acquired for the purposes of donating it to charity.

To find out more about working out the value of Income Tax relief see the ‘More useful links’ section for a link to the detailed guidance notes .

Income Tax relief example

  • You own a second property and decide to give it to a charity.
  • A qualified property agent values the property at £90,000 and charges £400 for the valuation.
  • The charity is grateful and gives you a painting worth £1,000.

To work out how much you can deduct from your income, add together the value of the property and the total amount of fees. Then take away the value of the painting.

Value of the property: £90,000
Plus the valuation fees: £400
Minus the value of the painting: £1,000
Total deduction: £89,400

So you can get Income Tax relief by deducting £89,400 from your total taxable income, but not gains, for the tax year in which you made the gift.

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How to claim tax relief

If you complete a Self Assessment tax return you can make your claim on the form. You can also ask HMRC to lower your payments on account for the next tax year.

If you pay tax through PAYE (Pay As You Earn) you can write to your Tax Office with details of:

  • your gift or sale to a charity
  • how much tax relief you would like to claim

HMRC will change your tax code for the current year or give you a refund for an earlier year.

Contact your Tax Office

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What records do you need to keep?

You need to keep the following records:

  • share transfer documents
  • a certificate from the charity that confirms land or a property has been transferred to them
  • any written request from a charity to sell land, property or shares on its behalf

You'll need these documents to support your Income Tax relief claim.

Find out more about what records to keep

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Contacting HMRC Charities

For more help you can contact the Charities Helpline.

Contact the Charities Helpline

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More useful links

Read more about giving land, building or shares to charity in the detailed guidance notes

Find out about giving land, building or shares to charity through your company

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