SAM121390 - Returns: individuals returns: charitable giving (facility withdrawn from April 2012)

The facility to make repayments to charity will be withdrawn from April 2012 for all tax years. From this date, although earlier years returns will still show the relevant boxes, the functionality will be removed and any repayment requested to go to a charity will be sent to the customer instead.

Individual taxpayers may indicate on their SA return if they want to nominate all or part of their SA repayment to go to a charity (Boxes 3 to 7 of the Charitable giving section page TR 4 on the Main Tax Return (SA100) or boxes 12.7 to 12.10 on the Short Tax Return (SA200)). In this context the SA repayment is the final amount to be repaid after taking into account any underpayment or overpayment already on the record, rather than the return overpayment for the year that may have been self-calculated.

Where the taxpayer nominates part of their repayment to go to a charity, they are required to enter the amount they would like to be donated. This amount is to be regarded as the maximum which could be donated after taking account of the total amount of repayment available including repayment supplement where appropriate. Where the amount specified is more than the amount of the overpayment available for repayment, the donation to charity will be limited to the amount of the overpayment.

Requests for repayments to be donated to charity cannot be accepted in any other form than on the SA return and repayments to charities cannot be issued clerically using function ISSUE REPAYMENT FROM OVERPAID BALANCE.

Each charity participating in the scheme will be allocated a unique charity code which taxpayers will enter on their SA return to identify their chosen charity. The list of the approved charity codes will be available on the HMRC Internet and Intranet sites.

The taxpayer will also be able to 'Gift Aid' their donation in order that their chosen charity can claim basic rate tax back from IR Charities on the amount donated.

A repayment notification will be sent to the nominated charity to advise them of the donation and whether or not Gift Aid applies, but the taxpayer's name and address will not be included unless the taxpayer gives us their permission to do so.

Any balance remaining is to be repaid to the taxpayer or nominee as appropriate. There will be no lower limit on the amount which a taxpayer can nominate to be donated to a charity. The normal de minimus limit of £10 applies to any balance repayable to a taxpayer or their nominee.

Invalid or ceased charity code

Where the charity code quoted is not a valid code and the taxpayer requests in their return that the full amount is to be donated to charity, or that part of their repayment is to be allocated to a charity and the balance to be repaid to themselves

• The full amount of any repayment is to be made to the taxpayer

Where the charity code quoted is not a valid code and the taxpayer requests in their return that part of their repayment is to be allocated to a charity and the balance be repaid to a nominee

• Using function ISSUE REPAYMENT FROM OVERPAID BALANCE, the part of any repayment allocated to a charity is to be made to the taxpayer and the balance is to be made to the nominee

Where the charity code quoted is in a valid format but it is not a current code as the charity no longer exists

• The return is to be fully captured. In cases where all the repayment is nominated to charity, or part is nominated to charity and the remainder to the taxpayer, the whole of the repayment will be automatically sent to the taxpayer. In cases where part of the repayment is nominated to charity and the remainder to a nominee, the repayment will be inhibited and a work item will be created on the 'Inhibit Automatic Repayments' Work List for clerical review, identified by the code 'G - Charity code does not exist'

Note: Where a taxpayer nominates part or all of their repayment to go to a charity and the 'Inhibited Repayments' signal is already set for other reasons, no repayment is to be made. The case will appear on the 'Inhibited Automatic Repayments' Work List.

Where the ‘No Repayment’ signal is set on the record before capture, any eventual repayment for the year will need to be made to the taxpayer clerically.

Repayments can only be made to a charity on the initial capture of a return because of the Gift Aid implications. Any amendment which results in a further repayment, and which the taxpayer has indicated they wish to be donated to charity, can not be made to the charity because repayments as a result of an amendment are not issued automatically.

For more detailed information see subject ‘Repayments Donated to Charity’ (SAM110200), and also subject ‘Inhibited Automatic Repayments’ (SAM113010).