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Gift Aid audits on the rise

HM Revenue and Customs has been conducting more Gift Aid investigations, with the number doubling in the last year and raising a further £6 million in the process.

Wilkins Kennedy (WK) obtained the numbers which show that HMRC conducted 1,057 audits and checks of statements provided by charities in 2012/13 for tax relief on Gift Aid. The number was an increase of 510 from the previous year.

A part of it comes from errors, but WK made the point that any controversy in charity tax avoidance has made HMRC sit up and take notice, in a bid to find further instances and claim back any monies owed in the process.

Registered charity the Cup Trust raised approximately £176 million from 2010-2012, a higher figure than the Salvation Army, the British Heart Foundation and the Royal Society for the Protection of Birds. However, just £55,000 was invested into its stated goal. Approximately £46 million in tax was avoided.

John Howard, a partner of Wilkins Kennedy, said that numerous charities know the issues all too well and are improving when it comes to Gift Aid management. One example is the implementation of tracking systems in order to claim tax back on the sales of any goods that have been donated.

With HMRC ramping up its investigations, accountants in the Wirral and up and down the UK representing charities will want to be sure – perhaps even more so than usual – that everything is accounted for and in order.

Posted by Louise
May 8, 2014
HMRC

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