Explanatory Notes

Finance Act 2012

2012 CHAPTER 14

17 July 2012


Section 50: Gift Aid: Giving through Self-Assessment Return


1.Section 50 repeals, with effect from 6 April 2012, the “SA Donate” scheme which enables an individual, who makes a self-assessment return, to direct HM Revenue & Customs (HMRC) to make any repayment of tax due for the tax year to a charity.

Details of the Section

2.Subsection (1) repeals section 429 of the Income Tax Act (ITA) 2007 which gives effect to the SA Donate scheme.

3.Subsections (2) and (3) make consequential amendments to remove references to section 429 of ITA 2007 from the Taxes Acts.

Background Note

4.Section 429 ITA 2007 provides for a scheme known as “SA Donate”. It enables an individual who makes a self-assessment return to direct HMRC to make any repayment of tax due for a tax year to a specified charity instead of to the individual.  In addition to the repayment, provided the individual has paid sufficient income tax or capital gains tax on the amount of the repayment donated to the charity, HMRC also pays the charity the basic rate of tax relating to the repayment in accordance with the gift aid rules at Chapter 2 of Part 8 of ITA 2007.

5.SA Donate has not been well used and is disproportionately expensive for HMRC to administer. It is being withdrawn with effect from 6 April 2012 in order to concentrate HMRC resource on the introduction of an online filing system for charities.  Taxpayers who receive repayments of tax from HMRC will still be able to give the money to their chosen charity under gift aid by making a direct gift to the charity.