Gift Aid (UK)
Under Gift Aid, a qualifying charity can claim basic-rate tax relief on an eligible donation, subject to the donor’s declaration and conditions. The donor’s grossed-up donation is relevant to adjusted net income and may extend the basic and higher rate bands in a UK income-tax computation, subject to applicable rules. The donor must have paid sufficient relevant tax or may need to make up a shortfall. Apply the rates and conditions for the assessment year.
Worked example
A taxpayer makes a qualifying Gift Aid donation and keeps the charity’s record. When preparing the relevant-year computation, the taxpayer uses the grossed-up amount for the applicable adjusted-net-income and tax-band calculations.
Common mistake
Using the cash donation as the gross amount, or assuming the donor can claim relief without satisfying the scheme’s tax and declaration conditions.
Where it appears in your exams
| Qualification | Exam | Relationship | Period |
|---|---|---|---|
| ACCA | TX (UK) | Direct | June 2026–June 2027 |