Tax efficient giving

The Princethorpe Foundation

At The Princethorpe Foundation we are a charity committed to providing exceptional education and support through our schools and a variety of related activities. Our mission is to nurture young minds and empower them to achieve their fullest potential.

As a registered charity (No. 1087124), The Princethorpe Foundation operates with transparency and integrity, adhering strictly to our charitable purposes. We are accountable to the Charity Commission for England and Wales, ensuring that we meet the highest standards of governance and accountability.

Making a Difference Through Tax-Efficient Giving

Did you know that you can make your charitable donations even more impactful while enjoying tax benefits? By taking advantage of various tax-efficient giving schemes, you not only support the causes you care about but also benefit financially. Here’s how:

Gift Aid: Maximise Your Contribution

If you're a UK taxpayer, Gift Aid is a fantastic way to increase the value of your donations at no extra cost to you. Every gift you make to The Princethorpe Foundation can be worth more, simply by opting into Gift Aid.

For every £1 you donate, the Foundation receives an additional 25p from the UK government. This means that a generous gift of £100 becomes £125 to support our initiatives. To learn more, visit HMRC’s dedicated Gift Aid webpage.

Donation Levels and The Benefits of Gift Aid

Donation Amount	Gift Aid Amount	Total Donation	Cost to a 20% Tax Rate Payer	Cost to a 40% Tax Rate Payer	Cost to a 45% Tax Rate Payer	Cost to a Business at 19% Corporation Tax	Cost to a Business at 25% Corporation Tax
£50	£12.50	£62.50	£50	£37.50	£34.37	£40.50	£37.50
£100	£25	£125	£100	£75	£68.75	£81	£75
£150	£37.50	£187.50	£150	£112.50	£103.12	£121.50	£112.50
£250	£62.50	£312.50	£250	£187.50	£171.87	£202.50	£187.50
£500	£125	£625	£500	£375	£343.75	£405	£375
£1,000	£250	£1,250	£1,000	£750	£687.50	£810	£750
£2,500	£625	£3,125	£2,500	£1,875	£1,718.75	£2,025	£1,875
£5,000	£1,250	£6,250	£5,000	£3,750	£3,437.50	£4,050	£3,750

Enhanced Benefits with Higher Rate Tax Relief

If you pay Income Tax at the higher rate of 40% or the additional rate of 45%, you can enjoy even greater benefits when you Gift Aid. You can claim back the difference between the tax rate you pay and the basic rate on the value of your donation.

For example, a donation of £1,000, with Gift Aid, is worth £1,250 to The Princethorpe Foundation. If you're a higher-rate taxpayer, you can personally claim back £250, effectively reducing the cost of your donation to £750. At the additional rate, you can claim back £312.50, making your donation cost only £687.50.

To assist you, we provide a donation statement detailing your contributions and Gift Aid, which you can use when filing your self-assessment tax return.

Legacies and Reducing Inheritance Tax

Leaving a legacy by including The Princethorpe Foundation in your will can be a meaningful way to support our work. In the UK, gifts to charity are currently exempt from Inheritance Tax. Additionally, if you leave 10% or more of your net estate to charity, the government provides further tax incentives.

Frequently Asked Questions (FAQs)

What is Gift Aid?

Gift Aid is a UK government scheme that allows charities to enhance the value of donations received. If you're an eligible UK taxpayer, we can claim an extra 25p for every £1 you donate, at no additional cost to you. For instance, a £10 donation becomes £12.50, making your generosity go even further.

Am I eligible for Gift Aid?

To qualify for Gift Aid, you must be a UK taxpayer and have paid, or expect to pay, sufficient Income Tax or Capital Gains Tax in the relevant financial year to cover the Gift Aid claimed on all your donations to charity. Generally, your donations qualify as long as they do not exceed four times the amount of tax you have paid in the relevant tax year (6 April to 5 April). If your tax situation changes, please inform the charities you support.

How do I know if I am a UK taxpayer?

You are typically considered a UK income taxpayer if:

Tax is deducted from your wages or pension before you receive them.
You complete a self-assessment tax return with HMRC each year.
You have taxable savings, a pension plan, or investment income.
You have paid Capital Gains Tax on the sale of assets like property or shares.

Please note that Inheritance Tax does not count as Income or Capital Gains Tax.

How do I sign up for Gift Aid?

Signing up for Gift Aid is simple! Just complete a declaration with each charity you donate to. You'll need to provide your full name and address, which HMRC uses to identify you. The declaration confirms that you are a UK taxpayer and understand your responsibility to cover any shortfall between the Gift Aid claimed and the tax you’ve paid.

You can:

Complete an online declaration for The Princethorpe Foundation.
Provide a verbal declaration over the phone, which we will confirm to you in writing.

What if I am retired and receiving a pension?

Even if you’re retired, you can still participate in the Gift Aid scheme as long as you've paid enough tax to cover the Gift Aid claimed on your donations. This includes tax on:

Private pensions where tax is deducted.
Savings account interest.
Capital Gains Tax from selling assets like property or shares.

Can I withdraw my declaration on a specific gift?

Absolutely! If you find that you won't be paying enough tax in a given year to cover the Gift Aid on a specific donation, simply contact us at makingadifference@princethorpe.co.uk. Remember, it’s your responsibility to inform us if you want to stop claiming Gift Aid on your donations.

The FAQs provided offer general guidance on the HMRC Gift Aid scheme and do not constitute professional legal advice. We always recommend consulting a professional advisor to fully understand any tax or financial implications specific to your situation.