Guernsey to explore benefits of gift aid

Allowing charities to reclaim tax on more donations could generate an extra £900,000 annually, according to the Association of Guernsey Charities.

Currently tax can only be reclaimed on personal donations of £500 to £5,000. The UK gift aid system has no limits.

The group's comments came as the Treasury and Resources Department vowed to explore the economic benefits.

A report examining the options for tax relief and overall cost is due to be completed by October.

Reclaiming tax on donations

  • Guernsey - on donations between £500 and £5,000
  • Jersey - on donations between £50 and £500,000
  • UK - on any donation

The association, which represents more than 300 groups in the Bailiwick of Guernsey, has campaigned for the change for almost three years.

Vice chairman Malcolm Woodhams said the island was not as generous as other jurisdictions when it came to reclaiming income tax.

He said he was "uncomfortable with the level of support given to Bailiwick charities through the local tax system for some considerable time".

Chairman Peter Rose said it was time the government made some contribution towards work it would otherwise have to pay for.

The group said currently about £300,000 is raised annually under the current arrangements and expected this to rise to £1.2m if the UK system was adopted - based on UK figures.

The association also wants donations made directly from salaries to be made net of tax as it "encourages small, but very valuable ongoing donations".

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