By Andy Page
WE'RE pleased to see that in the 2018 Autumn Budget the Government have listened to calls from the charity sector with regards to reducing the admin burden they face, despite the changes not featuring in the Chancellor's speech itself and being buried in the detail of the red book.
In particular, smaller charities will welcome the raise of the de-minimis trading limit from £50k to £80k, a threshold that has not been updated for many years. The limit enables charities to carry out a small amount of non-primary purpose trading without being subject to tax. Many charities do undertake a small amount of non-charitable trading, so this update will save them the admin time and costs associated with running a trading subsidiary. The change takes effect from 1 April 2019 for incorporated charities and 6 April 2019 for unincorporated charities.
Further, charitable shops now only have to contact donors regarding their donations every three years, where the donation raises less than £20 a year. Again, this will massively reduce the admin burden that charities face.
Finally, another reduction of admin comes with the increase in the threshold to £30 for eligible donations under the Gift Aid Small Donation Scheme. Charities can now accept more 'smaller donations' without the need to obtain the Gift Aid declaration, which has often caused a lot of hassle and proved time-consuming.
These announcements, on top of the deferral of the Making Tax Digital measures for some charities, (e.g. trusts and unincorporated charities) will be welcomed by many and allow charities to focus on their charitable causes rather than focusing on the cost and admin involved.
The Government also announced extra funding for Air Ambulances and a £10m donation to the Armed Forces Covenant Fund Trust to support veterans on the centenary of the First World War, in lieu of exempting VAT on the sales of commemorative statues. It's good to see the Government supporting the sector with welcomed funding.
For further advice on any of the above, contact Moore Stephens on 01536 461900.For all the latest information and analysis on the 2018 Autumn Budget, visit www.moorestephens.co.uk