There are many ways you can help your favourite charity, which not only benefit the cause in question but also host a number of advantages for you.
People in wealthy countries like the UK donate significantly less than low-income countries, says the New Giving Report by the Charities Aid Foundation (CAF). “There is considerable untapped potential for philanthropy in the UK,” explains Edward Garrett, Head of Private Clients at CAF. “The health of our civil society is directly tied to charitable giving, so we need to build our British culture of giving to ensure its strength for the future.”
That said, according to The Beacon Collaborative, giving from high net worth individuals in the UK is increasing at an impressive rate, reaching £11.3 billion last year — up from £7 billion in 2022. So, while the wealthy’s commitment to charity is clearly there, we could certainly do more. Here are some expert ways that you — or your company — can make a big difference to a cause close to your heart.
Start a Philanthropic Matching Programme
One way to up your philanthropic game is to encourage contacts to match what you give. “The concept of matched giving is that one donor commits an amount of money, conditional on others providing a similar amount,” says Ben. “It’s been used to great effect by The Big Give, especially in their Christmas Challenge. You may be able to benefit from this type of arrangement or, if you are planning on committing a significant sum, you might offer it on a matched basis to encourage others. Company funds used for a Matched Giving account are tax-effective and can be deducted from your organisation’s corporation tax.”
Utilise Giving is Great
Deciding on where you would like your money to go to can be a minefield — but help is at hand. “Over the last four years, The EQ Foundation has built a platform, Giving is Great, using principles that work when selecting investments, to help donors when giving to charity,” says Ben. “There are over 160,000 charities in the UK alone, so finding one that has the most meaning for you isn’t always easy. Giving is Great helps those looking to support charities based on the evidence of their impact and how much support they receive from professional grant makers.” Use the platform to search by charity name or by cause: everything from addiction to environmental organisations will welcome your help.
Host a Charity Event
“There’s a strong link between the appearance of charity events, the emotions they evoke in guests, and the donations they receive,” says Rita Chandarana, Director at corporate event specialists Eventologists Ltd. “In today’s world, where people are always on the lookout for sensory experiences, charity events need to compete for individuals’ time, attention, and money. To build a loyal following and encourage donations, it’s essential to create events that are entertaining, theatrical, and immersive. The more captivating a charity event is, the higher the chances of achieving record-breaking donations.”
Add Gift Aid
This is undoubtedly the simplest way to add more funds to your contributions. Gift Aid is a government scheme which allows charities to claim an extra 25p for every £1 you donate, so signing up is the easiest way to boost your giving. “All donations to registered charities attract Gift Aid as long as the donor can make a declaration that he or she will be paying the equivalent amount of Income Tax in that financial year,” says Ben. “So, if you donate £1,000, the charity can then reclaim an extra £250 direct from HMRC. If you pay more than Basic Rate Income Tax then you can claim additional relief via Self-Assessment.”
Make a Social Impact
High net worth individuals can contribute more than their finances — they can pass on their insight and skills, too. “A great way for an individual to give back to the community is to engage with social impact organisations by investing time or resources,” says author and Career Ready UK ambassador, Eloise Skinner. “Career Ready UK is the UK’s national social mobility charity, working with thousands of young people to improve career opportunities and connections to the world of work; offering programmes including mentoring, masterclasses, and workplace visits.” To get involved, register with the volunteer database and help give a young person the opportunity to kick-start a rewarding future.
Set Up a CAF Charitable Trust
Considering setting up your own charitable trust? “The Charities Aid Foundation offers individuals and businesses the advantages of their own charitable foundation, but without the extra time and commitment needed, administrative and compliance requirements or associated costs,” explains Philipa Cornish, Clients Relations Director at the charity. “Our Company Account lets businesses manage their corporate giving in one place — the business contributes funds into the account, and we hold them until they are ready to use for a charitable purpose. And, as CAF is a charity, the contributions into the account are considered a charitable donation, which means you only need to record one donation to claim tax relief on all your giving.”
Leave a Charitable Legacy
Donating part of your estate allows you to leave a lasting legacy — and offers generous tax incentives too. Remember a Charity surveyed 500 individuals with over £1 million in investible assets and found half of the millionaires had included a charitable gift in their will, rising to 75% for individuals with estates of £5 million or more. “There are benefits attached to making charitable bequests”, explains Ben Faulkner, Communications Director at EQ Investors. “First, any bequests to registered charities are exempt from Inheritance Tax; and secondly, if your total charitable bequests amount to at least 10% of your net estate then the rate of tax on the rest of the estate is lowered from 40% to 36%.”
Give As You Earn
If you are an employer, it’s important to encourage your staff to give to charity as well. “Employers have the option to provide staff with a Payroll Giving scheme, also known as Give As You Earn, which works in a similar way to salary sacrifice by providing employees with a simple and tax-efficient way to make regular donations to charities,” continues Philipa. “Donations are taken before Income Tax is deducted; allowing your donation to go further for the charities you support, while costing you less.”
Help for Dual Taxpayers
If you pay tax in the UK and America, you may be due some tax relief. “The CAF America Donor Fund helps dual US/UK taxpayers give tax effectively, distributing over £1 billion in donations to charities worldwide since its launch 25 years ago,” says Philipa. “The donor advised fund helps donors make the most of their charitable giving by ensuring they get the tax relief they’re due on both sides of the Atlantic, increasing UK giving by 25% thanks to Gift Aid, and increasing US tax deduction by 25%”.
