Icon: more incisive work from Intelligent Giving
 A piggy bank

Giving to charity: the basics

THE BEST WAY TO GIVE IS REGULARLY, to carefully selected charities. You can browse our charity profiles to find an effective charity. Charities need continuing support to keep going. So, if there's a charity you believe in, it's worth signing up to a regular direct debit, and perhaps top it up every now and again with one-off gifts in response to major appeals. Even a couple of quid a month is valuable.
 
More on why regular giving is so good. . .
Why is regular giving so good?

Giving regularly is often more helpful than other kinds of giving. Here’s why:

  • Good charities need to know the cash will keep coming. That’s because they plan for the future. In many situations, long-term projects are the most effective way to help those in need. But your chosen charities will be unable to make long-term plans without an assurance that their funding will keep coming. Most other forms of funding come and go. Direct debit gives good charities the confidence they need.

  • Good charities want cash to spend as the need arises. Most large grants and government funding is tied to specific criteria (finding work for one-legged pigeon fanciers in Hull) and must be used within a limited time frame. This is not in itself a bad thing. But good charities only really thrive with a bit of freedom. A regular donation through direct debit will (typically) not be restricted to any particular project. So some of your money may go towards paying administrative costs, salaries etc… We think this may be a price worth paying, as it can mean that the rest of your money is used far more effectively.

But don’t just give your own money. Multiply your donation by making other people give with you. In fact, you should never - ever - give alone. Everyone from your next-door neighbor to Gordon Brown can be persuaded to contribute. We reveal how:


Make the Taxman pay
The easiest, and probably most important, way to increase the power of your donation is by getting the taxman to donate with you. Under the 'gift aid' scheme, he will give the charity an extra 28% on top of your donation, if you are a UK tax payer. And signing up for gift-aid is simple.

Here's how it works: by the time money reaches your bank account, you’ve almost certainly already paid tax on it. When you give that money to charity, the taxman refunds the tax he took, giving it to the charity.*  This works out to be one quarter of the money you give to the charity. So, if you donate £100, the taxman will donate an extra £25 to the same charity. For a limited time only (until spring 2011), he will give an extra £3 on top. The taxman gives away about a billion pounds through gift-aid every year. But, astonishingly, between one and two thirds of donors don't take advatage of the offer.

It’s really easy to make the taxman pay, and it costs you nothing at all. There’s no standard form, but most charities provide a form if you need one. All charities really need is your full name, address, and a declaration saying that you want to use gift aid. And you don’t need to tell them all this for every donation – you can simply say on the first occasion that every future donation should be counted as gift-aid too. If you’ve been making donations without using gift-aid, you can back date your gift-aid declaration, asking the taxman to donate the tax he took on any donations you made in the last six years.

(*Provided that you paid tax in the first place, either this year or last year. If you pay a higher rate of tax, the tax man will give you the change - talk to your accountant.)


Make your Boss pay
It's trendy for businesses to appear charitable. Many larger companies now budget to give a certain amount of money to charity. Here’s how you can get your hands on the boss’s billions:

Matching funding Many companies will now match employees’ donations, instantly doubling your funds. They might also match fund money raised through charity events based in your workplace, which could be as simple as dressing up for Comic Relief and the like.

Payroll Giving Here’s the deal: you sign up to give a regular amount to any charity of your choice every month, and your employer deducts the amount before tax gets taken off. Your boss doesn't necessarily contribute any extra money, but he should look after the paperwork. There’s a small administration fee (about 4%). Some employers will cover this cost for you.

Typically, donating your money through payroll giving will be less efficient than donating through gift-aid. Unless you pay alot of tax, the charity will get around £7 less for every £100 . However, payroll giving is convenient and painless (because you never see the money you are donating to charity). If you pay lots of tax, it may even be more efficient.

Volunteering If you have a job, there’s a one-in-three chance that your boss will support you as you volunteer. If you work for a large company, your odds are much better. This support could amount to anything from paid time-off to simply allowing you more flexible working hours. See ‘Escape your day job’ for more.
 

Make your Mates pay
It’s scientifically proven: giving in a group makes everyone more generous. So join with your mates/workmates/street and share the experience. There’s help available for groups who want to give. The Funding Network is a meeting place for those who want to give together, and those who want donations. Read the network founder, Fred Mulder’s article in our articles section. Meanwhile, The One Percent Scheme is a bunch of friends who have come together to donate 1% of their income to charity. It’s a social occasion (think sports clubs, with a bit less alcohol). You can join them too.

You can also get your mates involved with some good old-fashioned sponsored events. Websites such as Justgiving and BmyCharity mean that you don't need to worry about tatty sponsorship forms and chasing people up for their 50p - they can give quickly and easily online, and it's really easy to add Gift Aid too. If your friends and work colleagues forward on the link, you can get donations from people you don't even know. Check out our Charity Challenges page for more.  


Make 'The Man' pay
When The Big Give was started in late 2008, it made £2million in just 45mins.  The secret was matched funding – you donate your money, and someone else will double it. Many organisations (both the corporate or government type) have agreed to match your donations, though only to certain pre-selected charities.