Martin Lewis has revealed why he believes Brits should be opting into Gift Aid when making donations to charity.
The MoneySavingExpert founder, who regularly appears on TV giving his top tips on how to make the best use of their cash, posted a video on X explaining why British taxpayers should say “yes indeedy” to Gift Aid after making a donation.
Gift Aid is a state-run scheme that enables charities to claim an extra 25p from the Government for every £1 they receive in donations.
However, in January of this year, the Charities Aid Foundation (CAF) claimed British charitable organisations were collectively missing out on £560 million a year, as only 55 percent of people were opting into Gift Aid.
Mr Lewis outlined why Brits should be making use of the scheme. “If you donate to a charity, say ‘yes’ to Gift Aid”, he said, “because that way the charity gets more and you may get more too.”
The chair of MoneySavingExpert.com told his followers: “So the simple rule is when you donate (if you’re a UK taxpayer, that’s crucial) just say ‘yes indeedy’ to Gift Aid. It is that simple.”
Later in video he detailed why it was a win-win for donors and charities alike.
“So when you’re paid, the tax office comes along and takes 20 percent of it away. So if you earned £25, you take home £20.
“But Gift Aid means, when you donate that £20 to charity the charity gets your money and the tax that you pay back”, he explained.
“Which works out as a gain of 25 percent on top [but it] doesn’t cost you anything but on each £20 it gets a fiver more. So say ‘yes’ to Gift Aid and the £20 becomes £25.”
The 52-year-old went on: “And there’s more. If you’re a higher 40 percent rate taxpayer.
“For every £100 you earn, you take home £60, the tax office gets £40. If you donate to charity, the charity still gets the 25 percent boost.
“So the charity is getting more and you can claim the remainder of the tax that you paid, back. You generally do this via your self-assessment form.”
