Updated April 2024

Streamline your Gift Aid claims

Boost your cash flow in 3 simple steps

In this article, backed by HMRC Gift Aid Guidance, we will demystify Gift Aid claims, and show you how to optimise your fundraising by effortlessly claiming Gift Aid on those donations you have raised.

The Gift Aid scheme is widely recognised in the charity sector for providing a valuable 25% boost to donation income. The best part, as it will help improve your cash flow, is that there is no limit to how often you can file your claims with HMRC. With Liberty Accounts easy-to-follow process and user-friendly cloud accounting software, you can boost your income throughout the year in line with your generous donations.

Step 1: Keep your donor details up-to-date

To make successful Gift Aid claims, it's essential to maintain accurate records of your donors and their taxpayer declarations. Our platform, powered by Liberty Accounts and guided by HMRC Gift Aid Guidance, simplifies this process. By regularly performing these simple record-keeping tasks, our system efficiently assesses which donors' contributions qualify for claiming.

Gift Aid claims for churches

For churches and religious organisations, Gift Aid claims can significantly boost fundraising efforts. Our platform provides tailored support for churches, making claiming Gift Aid seamless and efficient. Easily update donor details and accurately record taxpayer declarations, ensuring churches make the most of their Gift Aid claims.

Step 2: Keeping Your Donations Updated

To maximise your Gift Aid claims, it's crucial to ensure your donations remain current. Our platform enables you to file your Gift Aid claim, including the latest contributions. Utilising the ledger, you can also record small cash collections and receive a Gift Aid top-up through GASDS (Gift Aid Small Donations Scheme) or Community Buildings GASDS, aligning with HMRC Gift Aid Guidance.

This feature allows churches to claim Gift Aid on various contributions, such as small cash/contactless collections, sponsorships, and community-building donations through GASDS. Whether it's for regular donations or special events, our platform empowers churches to unlock the full potential of Gift Aid, making a more significant impact on their communities and supported causes.

Step 3: Claim Regularly and Effortlessly

With Liberty Accounts, claiming Gift Aid becomes a breeze. Once you've completed steps 1 and 2, submitting your claim monthly, or even more regularly, is effortless. Our user-friendly software streamlines the process, making it as simple as pie. You can even use the ledger to set up sponsored events and record sponsored income donations for each participant, making your Gift Aid claim smoother than a 100-mile bike ride!

We aim to make the Gift Aid process seamless and straightforward, providing you with the answers to common questions that may arise:

How Does Gift Aid Work? What Is a Gift Aid Declaration?

Gift Aid enables charities to claim an extra 25% from HMRC (Her Majesty's Revenue and Customs) on eligible donations made by taxpayers. To qualify for Gift Aid, donors must make a Gift Aid Declaration, expressing their intention to donate under the scheme. This declaration ensures that their contribution meets the requirements for Gift Aid.

Can Churches Claim Gift Aid?

Absolutely! Churches and eligible nonprofit organisations can also benefit from Gift Aid. Our platform caters to churches' unique needs, making claiming effortless.

Can Gift Aid Be Claimed Retrospectively? Can I Claim Charitable Donations from Previous Years? How Many Years Can You Backdate Gift Aid?

Yes, HMRC allows you to claim Gift Aid on eligible donations up to four years ago, provided you have the appropriate Gift Aid Declaration. This means you can recover funds from previous years and make the most of your contributions.

Do I Have to Declare Gift Aid on My Tax Return? Does a Gift Aid Declaration Expire?

As a donor, you don't need to declare Gift Aid on your tax return. Gift Aid Declarations do not expire, and charities must keep records of them for auditing purposes.

Does HMRC Check Gift Aid?

Occasionally, HMRC may conduct checks on Gift Aid claims to ensure compliance with regulations. With our software, you can have confidence that your claims are accurate and aligned with HMRC guidance.

How Do I Claim Back Gift Aid from HMRC? How Do I Make a Gift Aid Declaration? What Should a Gift Aid Declaration Contain?

Our online platform makes claiming back Gift Aid from HMRC a seamless process. Making a Gift Aid Declaration is simple, requiring the donor's name, the charity's name, a statement expressing their intention to make a Gift Aid donation, and confirmation of having paid enough tax to cover the donation.

How Does Gift Aid Affect My Tax? What Are the Rules for Gift Aid?

Gift Aid does not directly impact your tax rate. However, for higher-rate taxpayers, making Gift Aid donations can potentially reduce their tax liability. Here's how it works:

When you make a charitable donation under the Gift Aid scheme, the charity can claim an additional 25% of the donation amount from HMRC. For example your donation of £100 becomes £125 for the charity. However, to claim this additional amount, the donor must have paid enough income tax or capital gains tax in that tax year to cover the amount being claimed by the charity. In other words, the taxpayer must have paid at least £25 in tax to cover the Gift Aid claimed by the charity on a £100 donation. For basic-rate taxpayers, the process remains neutral. The donor receives no direct financial benefit, and the tax they paid on the donated amount is used to boost the donation for the charity. The donor's tax liability remains unchanged.

But for higher-rate taxpayers, the scenario is different. When they make a Gift Aid donation, they can claim back the difference between the basic rate of tax and the higher rate of tax on the donation amount. This effectively reduces their tax liability by the difference.

For example, a higher-rate taxpayer making a £100 Gift Aid donation is eligible to claim back £25 (£125 donation amount - £100 actual donation). So, if their higher rate of tax is 40%, they can claim back £25 at 40%, which is £10. Thus, their actual tax liability is reduced by £10 because of the Gift Aid donation.

It's essential to follow the rules and guidelines set by HMRC to ensure that your Gift Aid donations are eligible for tax relief. Some of the key rules include:

  • Ensuring you have a valid Gift Aid Declaration for your donations.
  • Keeping records of your Gift Aid donations and the tax you've paid to support your claims.
  • Not receiving any benefits or rewards in return for your Gift Aid donation that could exceed the allowed limits.

By adhering to these rules and being mindful of your tax situation, you can make the most of Gift Aid donations while also making a positive impact on the charitable causes you support. Always consult with HMRC or a qualified tax professional if you have any questions or concerns about Gift Aid and its impact on your tax.

What Does the Donor Need to Do?

As a donor, providing a valid Gift Aid Declaration to the charity is all you need to do. Ensure you've paid enough tax to cover the donation to qualify for Gift Aid.

What Can You Claim Gift Aid On? What Can't You Claim On?

Gift Aid can be claimed on most donations to charities and community amateur sports clubs. However, certain payments, like membership fees or payments for goods and services, do not qualify for Gift Aid.


The Gift Aid scheme, backed by HMRC Gift Aid Guidance, offers a substantial advantage for charities by allowing an additional 25% income on eligible donations. By maintaining up-to-date records of donors, ensuring donations are current, and regularly claiming through platforms like Liberty Accounts, organisations can optimise their fundraising. For churches, this system not only enhances the claiming process but also allows for a variety of contributions to be included, such as small cash donations and community-building gifts. Donors play a pivotal role by providing a valid Gift Aid Declaration and ensuring they've met the tax requirements for their donations. While Gift Aid can be a boon, especially for higher-rate taxpayers who can claim back tax, it's vital to adhere to HMRC guidelines to maximise benefits and remain compliant.

Join us now to simplify your Gift Aid claims, adhere to HMRC Gift Aid guidance, and make a more significant impact on the causes that matter to you.

With our cloud accounting software, managing Gift Aid has never been easier!

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