Improving HMRC guidance on Gift Aid donor benefits

STEP has been invited to join an HMRC Working Group which will review the guidance on Gift Aid donor benefits. The Working Group will review the interpretation of the rules that apply to donor benefits within the HMRC guidance covered by Chapters 3.18 to 3.25.

Objectives

Representatives have been selected from the charity sector, HMRC and HMT and the group held its first meeting hosted by HMRC last week. The group has initially identified the need to include the valuation of certain benefits for application of the relevant value test; the meaning of the ‘in consequence’ rule; and the correct application of the split payment rule.

The objective of the working group is not to amend the legislation or policy but simply to clarify and improve the guidance. HMRC has confirmed that proposed changes to the guidance cannot extend, override or supplement any statutory provisions.

HMRC is keen to mitigate the confusion and litigation that can ensue when the guidance is misinterpreted by charities and donors, for example, when gift aid contributions are misunderstood from the donor’s perspective which can lead to HMRC demanding large refunds. The overriding objective of the working group is to enhance the guidance to make it work as efficiently as possible and promote best practice within the sector.

Tell us your views

We would like to invite STEP members to provide examples of how the guidance could be improved in order to clarify interpretation of the existing legislation. You may wish to provide examples of how the guidance can be misinterpreted or, alternatively, mark up the guidance to show suggested changes.

Outcome

Once HMRC has collected the proposed changes from the working group representatives they will refer the guidance to HMRC’s solicitors for review prior to publication. The estimated date for publication is early 2019.

We would very much value your input. Please send your feedback to  policy@step.org by 15 November 2017.

Emily Deane TEP is STEP Technical Counsel

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