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TAX RELIEF FOR HIGHER RATE TAX PAYERS
There has been much discussion about the government’s proposed changes to Gift Aid which would limit tax relief on donations. Some of the letters I have read in the papers seem to have misunderstood how things currently work and have the impression that wealthy people are ‘using’ charity donations to make personal gain. This is incorrect. Firstly charities have to ensure donors only receive a minimal amount of personal benefit from any donation. Secondly, no-one is ever better off from making a donation. The amount of the donation is always more than any tax benefit received. If the proposals reduce the amount some people donate it will be charities that lose out.