Charities and the Chancellor

The Budget, Autumn 2017

Perhaps it would have been fair to anticipate that Chancellor Philip Hammond would not have a great deal of time or energy to devote to the concerns of the charity sector. Nonetheless, there has been some movement on the vexed issue of the complexity of Gift Aid, especially relating to donor benefits, and an announcement of additional funding to tackle homelessness.

Gift Aid

As previously promised, a simplification of donor benefit rules has been formulated. The current three thresholds are to be replaced from April 6th 2019, with just two.

  • The benefit threshold for the first £100 of the donation will remain at 25% of the amount of the donation.
  • For larger donations, charities will be able to offer an additional benefit to donors up to 5% of the amount of the donation that exceeds £100.

The total value of the benefit that a donor will be able to receive remains at £2,500. Four extra statutory concessions that currently operate in relation to the donor benefit rules will also be brought into legislation.

Social media and other comment from the charity and finance sector is mixed. A summary of responses to a consultation on simplifying the Gift Aid donor benefit rules will be published on December 1st. (para 3.20)

Personal Tax Allowances

The Budget announces that in 2018-19 the Personal Tax Allowance will increase to £11,850. Perhaps whilst contacting donors about GDPR, charities might want to consider taking the opportunity to flag this increase up to donors to check the eligibility of their gifts. The Higher Rate Tax Threshold will rise to £46,350. (para 3.5)

Homelessness

As part of its commitment to halve rough sleeping by 2022, and to eliminate it by 2027, the government is tasking the Homelessness Reduction Taskforce with development of a cross-government strategy to tackle the problem (para 5.33). It is to be hoped this will recognise and use the expertise and work many charities have put into this growing crisis.

Cultural Development

To support the role culture can play in regeneration and local growth, the government will provide £2 million funding to the Department for Digital, Culture, Media and Sport for place-based cultural development. (para 4.83)

Landfill Communities Fund

The government will set the Landfill Communities Fund for 2018-19 at £33.9 million, in accordance with the announcement at Spring Budget 2017 that the cap on contributions by landfill operators would be set at 5.3%. (para 3.52)

VAT

An Accident Rescue Charities Grant Scheme will be established to meet the cost of normally irrecoverable VAT. (para 3.63)

Mental Health

In December, a green paper will be published setting out the government’s plans to transform mental health services for children and young people. (para 6.10)

Land Value Uplift

In this year’s Housing White Paper, the government committed to respond to the CIL Review. DCLG will launch a consultation with detailed proposals on the following measures: removing restriction of Section 106 pooling towards a single piece of infrastructure where the local authority has adopted CIL, in certain circumstances such as where the authority is in a low viability area or where significant development is planned on several large strategic sites. This will avoid the unnecessary complexity that pooling restrictions can generate. (para 5.14)

Credit Union Membership

Credit Unions will be allowed to increase their numbers of members from the current limit of 2 million to 3 million. This is intended to increase access to reputable sources of credit for those who may not qualify for mainstream banking services (para 4.39)

LIBOR

The last tranche of the LIBOR Charity Funding Scheme was also announced, with a further £36 million of banking fines to be shared out over the next 3 years among armed forces, emergency services and other charities. (para 4.40)

There will be widespread relief amongst charities and others that there are measures to address the crisis around Universal Credit. (paras 6.13 to 6.16)

All paragraph references above relate to the Budget Statement
https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/661480/autumn_budget_2017_web.pdf

Please note: This bulletin is published as a general guide to the 2017 Autumn Statement and not intended to replace specific professional advice from, for example, a solicitor or accountant. You should always refer to the official websites shown above for further information. Craigmyle consultants take no responsibility for the correctness or completeness of information or interpretation given here.

The Budget, Autumn 2017

Perhaps it would have been fair to anticipate that Chancellor Philip Hammond would not have a great deal of time or energy to devote to the concerns of the charity sector. Nonetheless, there has been some movement on the vexed issue of the complexity of Gift Aid, especially relating to donor benefits, and an announcement of additional funding to tackle homelessness.

Gift Aid

As previously promised, a simplification of donor benefit rules has been formulated. The current three thresholds are to be replaced from April 6th 2019, with just two.

  • The benefit threshold for the first £100 of the donation will remain at 25% of the amount of the donation.
  • For larger donations, charities will be able to offer an additional benefit to donors up to 5% of the amount of the donation that exceeds £100.

The total value of the benefit that a donor will be able to receive remains at £2,500. Four extra statutory concessions that currently operate in relation to the donor benefit rules will also be brought into legislation.

Social media and other comment from the charity and finance sector is mixed. A summary of responses to a consultation on simplifying the Gift Aid donor benefit rules will be published on December 1st. (para 3.20)

Personal Tax Allowances

The Budget announces that in 2018-19 the Personal Tax Allowance will increase to £11,850. Perhaps whilst contacting donors about GDPR, charities might want to consider taking the opportunity to flag this increase up to donors to check the eligibility of their gifts. The Higher Rate Tax Threshold will rise to £46,350. (para 3.5)

Homelessness

As part of its commitment to halve rough sleeping by 2022, and to eliminate it by 2027, the government is tasking the Homelessness Reduction Taskforce with development of a cross-government strategy to tackle the problem (para 5.33). It is to be hoped this will recognise and use the expertise and work many charities have put into this growing crisis.

Cultural Development

To support the role culture can play in regeneration and local growth, the government will provide £2 million funding to the Department for Digital, Culture, Media and Sport for place-based cultural development. (para 4.83)

Landfill Communities Fund

The government will set the Landfill Communities Fund for 2018-19 at £33.9 million, in accordance with the announcement at Spring Budget 2017 that the cap on contributions by landfill operators would be set at 5.3%. (para 3.52)

VAT

An Accident Rescue Charities Grant Scheme will be established to meet the cost of normally irrecoverable VAT. (para 3.63)

Mental Health

In December, a green paper will be published setting out the government’s plans to transform mental health services for children and young people. (para 6.10)

Land Value Uplift

In this year’s Housing White Paper, the government committed to respond to the CIL Review. DCLG will launch a consultation with detailed proposals on the following measures: removing restriction of Section 106 pooling towards a single piece of infrastructure where the local authority has adopted CIL, in certain circumstances such as where the authority is in a low viability area or where significant development is planned on several large strategic sites. This will avoid the unnecessary complexity that pooling restrictions can generate. (para 5.14)

Credit Union Membership

Credit Unions will be allowed to increase their numbers of members from the current limit of 2 million to 3 million. This is intended to increase access to reputable sources of credit for those who may not qualify for mainstream banking services (para 4.39)

LIBOR

The last tranche of the LIBOR Charity Funding Scheme was also announced, with a further £36 million of banking fines to be shared out over the next 3 years among armed forces, emergency services and other charities. (para 4.40)

There will be widespread relief amongst charities and others that there are measures to address the crisis around Universal Credit. (paras 6.13 to 6.16)

All paragraph references above relate to the Budget Statement
https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/661480/autumn_budget_2017_web.pdf

Please note: This bulletin is published as a general guide to the 2017 Autumn Statement and not intended to replace specific professional advice from, for example, a solicitor or accountant. You should always refer to the official websites shown above for further information. Craigmyle consultants take no responsibility for the correctness or completeness of information or interpretation given here.