Tax-Efficient Giving

PCCs like Saint Martin’s are legal charities and, as such, are exempt from income tax. The tax which has been paid on the giving of Church people can be recovered from the Inland Revenue. Church people should understand that this recovery of tax is not "stealing from the Government" but good stewardship of their resources. The government already takes 17.5% of most of our expenditure as we can’t claim VAT back as most business can.

Gift Aid - How does it work?
Gift Aid is surprisingly easy to use. Gift Aid can apply to donations of any amount, large or small, by cash, cheque, postal order, direct debit, standing order, debit or credit card or even in a foreign currency (including the Euro).
If you are a UK taxpayer, all you have to do is give the Church a simple Gift Aid declaration. This might involve completing a short form or just giving basic details to the Church over the phone.
What's more - one single Gift Aid declaration can apply to all past donations you have made (since April 2000) and to all future donations you make.
As a higher rate taxpayer looking to reclaim tax from your donation, all you have to do is remember to include details of your charitable gifts on your tax form. Also, from April 2003, higher rate taxpayers were able to reclaim tax relief from donations paid to charity both during the previous tax year and during the current tax year, that means the relief is paid that much quicker.
Donors who are liable to tax at the basic rate
If a donor wishes to make a regular net contribution of £100 to the Church, this is paid from their gross income of £128.21, on which they have to pay income tax. At a 22% basic rate of tax they pay £28.21 in tax, leaving £100 to be paid to the Church. The Church can then recover tax at the basic rate from the Inland Revenue and the gift is worth more to the Church than one that does not qualify for tax relief.

Donors who are liable to tax at the higher rate
Donors who are liable to tax at the higher rate (40%) will have paid £51.28 in tax. The Church can re-cover tax only at the basic rate but the higher rate relief can be claimed back by the donor - by entering the details on their Self Assessment tax return. A net gift of £100 to the Church then only costs the donor £76.93. The Church will hope that this reclaimed tax will be used to increase the donation at no extra cost.

Do you qualify?
Providing you pay as much tax (income and/or capital gains) as the Church will be entitled to reclaim on your donations in the same financial year, you are entitled to use Gift Aid. For example, if you wish to Gift Aid your charitable donations that total £100 in one year, you will need to have paid at least £28 in to the taxman in respect of that tax year.

Payroll Giving
Payroll Giving is a flexible scheme that enables you to make donations to the Church (or any charity) straight from your gross salary (before tax has been deducted). This means that you get immediate tax relief on the value of your donation. Therefore, for a basic rate taxpayer wanting to give a £10 donation, it will only cost £7.80, or just £6 for higher rate taxpayers.
Furthermore, many employers are encouraging the scheme by matching their employees' donations. You can give regularly in this way by authorising your employer to deduct a monthly amount, but Payroll Giving can also be applied to one-off donations.

How does it work?
Very easily. Your payments are deducted straight from your salary either as a regular monthly payment or as a once off gift. All you need to do is choose how much you want to give and to which charity or charities, tell your payroll department and they will do the rest.
If you are UK taxpayer, paid through PAYE, your company is almost certainly eligible to offer Payroll Giving (they may refer to the scheme using a specific brand name, such as Give As You Earn). Speak to your employer to clarify whether they offer a Payroll Giving scheme, and if so, your employer will be able to arrange for your payroll administrator to deduct charitable donations from your gross pay.

Payroll Giving - What if my company does not offer Payroll Giving?
If your employer, doesn't offer a Payroll Giving scheme, why don't you suggest it to them? It will be easier than they may think, and plenty of advice is available

Share Giving
Giving shares to the Church or charity is not a new idea, but since April 2000, there is a new tax incentive to make Share Giving even more attractive. Individuals who give shares to charity are entitled to claim back full tax relief against the value of those shares. So, a gift of shares worth £1,000 will only cost a higher rate taxpayer £600, or £780 for lower rate taxpayers and furthermore, no capital gains tax will apply.
There are many reasons why giving shares might appeal to you. You might hold windfall shares as a result of a privatisation or demutualisation that are effectively gathering dust, making little difference to you, but they could make a big difference to Saint Martin’s. Or, you may own small parcels of shares, perhaps as a result of an inheritance that you regard as a bit of a nuisance as they generate more paperwork than income. These could be turned into something of real value to others by donating these shares to us.

How does it work?
Tax relief is available to UK taxpayers donating shares and securities listed on the UK Stock Market, the Alternative Investment Market, and recognised stock exchanges overseas. It is also available for units in a UK unit trust, shares in a UK open-ended investment company (OEIC), and some similar foreign investments.

You can claim tax relief equal to the market value of the shares on the day you make the gift, together with any associated costs such as brokers' fees. Furthermore, capital gains tax (CGT) on any increase in the value of the shares since you bought them, will not apply.

Above all please consider moving to standing order for your regular giovingf and Gift Aid it.

If you have any questions please email me on gareth@bowen.to

Blessings,

Gareth

Giving and Christian Stewardship

Those of us who have struggled with our weight know well that it is not simply a case of going on a diet for the odd week or two, but of re-educating ourselves in our eating habits that will really transform our situation and bring about a permanent improvement in our health.

A similar programme of re-education needs to be undertaken with regard to Christian Stewardship. Too many still regard it as a means of extricating a parish from its financial problems, as a "crash diet" for a week or two, and not as a way of life in response to God, a steady programme of growth in Christian discipleship.

Christian Stewardship is a response to God

The Christian understanding of Stewardship is derived from our understanding of the nature of the generosity of God.

God the Creator

Because God is the Creator and has given men and women a special place in his purposes on earth and dominion over all other living creatures, men and women are called:

- to worship God and to give thanks for his goodness

- to use the natural world and other living creatures in the service of God and all people and not for self-interest and exploitation.

God the Saviour

Because God has made himself known most fully in Jesus Christ, and has acted uniquely and decisively in him to save the world and to give forgiveness, grace and eternal life, men and women are called:

- to put their trust in God and live in companionship with Jesus Christ

- to follow Jesus in showing love to others; to use their minds, bodies and possessions to glorify God, and to give practical help to people in need.

God the Holy Spirit

Because God has formed the Church, entrusted the Church with the Gospel and given gifts to men and women through the Holy Spirit:

- the Church is called to make Jesus Christ and the Gospel known.

- individual Christians are called to use their gifts in his service.

A response in active giving

To describe our response and love we use the words "Christian Stewardship". We do so because the word "steward" is used in the Bible to express the concept of responsibility for the use of material possessions and spiritual powers.

Christian Stewardship may therefore be defined as the response which we the Church, collectively and individually, are called to make to God for all that he has given us and done for us, above all in Jesus Christ.

Our response in Christian Stewardship is therefore active:

as we respond to God in praise and thanksgiving
as we look on the universe as God's creation
as we treat the earth and its resources as God's provision for the needs of all mankind
as we seek to consecrate our personal wealth to God
as we regard our lives, our powers and possessions, our money and material wealth as gifts from God to be enjoyed and used in his service
as we seek to be "Stewards of the Gospel" and to share in Christ's mission to the world


Unless our money gift has cost us something, it is not really a thanksgiving but more like a tip. And one of the tensions in our discipleship lies in whether we live our life and give to God the odd crumb, or whether we give to God first, and then manage the rest. If the Christian disciple does the first, he will never be satisfied: If he does the second, he will always have enough.