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Whose gift?

21 June 2011
Issue: 4309 / Categories: Forum & Feedback , Income Tax
If charitable payments are made under gift aid from a joint bank or credit card account, what are the implications if the account holders pay tax at different rates?

In my accountancy practice we have many clients who make regular gifts to charity under gift aid.

Typically the clients are married couples where one partner pays tax at a higher marginal rate than the other and we have always tried to recommend that it is that partner who makes the gift and claims
the relief.

However in the age of internet sites dealing with charitable giving we are increasingly seeing situations where the lower-rate taxpayer wants some of the recognition for the donation (often in the form of sponsorship).

In many cases the payments come out of the couple’s joint bank account or from a credit card account where both partners have a card (but the account is in the name of one partner only).

In this era of independent taxation ...

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