With the start of the new tax year rapidly approaching, here is a reminder of a few key tax changes impacting charities that come into effect in April 2019:

Charities’ Small Trading Exemption

Charities can still be exempt from paying tax on trading income that does not relate to their primary purposes as long as such turnover does not exceed the small trading tax exemption.

From 1 April 2019, the limits are as follows:

Annual charity income Maximum level of non-primary purpose trading
Under £32,000

(was £20,000)

£8,000

(was £5,000)

£32,000 – £320,000

(was £20,001 – £200,000)

25% of income

(no change)

Over £320,000

(was £200,000)

£80,000

(was £50,000)

The increases in these limits will allow charities to carry out more non-primary purpose trading activity before a trading subsidiary is required.

Gift Aid Small Donations Scheme

The Gift Aid Small Donations Scheme (GASDS) allows charities and community amateur sports clubs to claim a ‘Gift Aid style’ top-up on cash donations received without the need for the donor to complete a Gift Aid declaration. This scheme therefore allows Gift Aid to be claimed on donations in collection tins or buckets.

In order to be eligible for the top-up payment, individual donations must not exceed £30 (this limit is £20 up to 5 April 2019). The total claim of £2,000 (on donations of £8,000) remains unchanged.

Gift Aid Donor Benefits

With effect from 6 April 2019, the rules around the value of donor benefits are being changed. As long as the value of the benefit does not exceed certain limits the donation will still qualify for Gift Aid.

The new rules are:

Donation amount Value of benefit
Up to £100 25% of amount of donation
Over £100 25% on first £100; and

Up to 5% of donation in excess of £100

(subject to maximum benefit value of £2,500)

For any advice on how these changes impact your charity, please get in touch.

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Martin Bailey - Partner

E: mbailey@goodmanjones.com

T +44 (0)20 7874 8877

I have particular expertise in the charity and the social business sector, working with organisations in 'The Third Sector' since joining the profession and developing vast knowledge and extensive experience in this time.

Charities are unique and have specialised reporting, compliance, and governance requirements. They require someone with specialist skills and knowledge to support them, allowing them to focus on their important work.

I work with organisations rather than for them, providing support and advice to issues as they arise - whether that be core accounts and audit compliance, VAT and taxation planning, governance issues, risk management, strategic reviews and advice, or designing accounting systems.

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