Here’s an administrative headache for you: A charity must keep records of substantial donors from 22nd March 2006. A substantial donor is one who has made gifts of at least £25,000 in a period of 12 months, or £100,000 in 6 years. Most charities won’t be in the position of having any substantial donors, but for those that do, there is a whole series of transactions which, if they happen, can invalidate the gift aid. Examples are: the provision of services, sale or letting or exchange of property, and provision of financial assistance, or investment all in either direction. Also remuneration; if someone made a donation of £25,000 this year and in 5 years time applied to you for a job, this could be an innocent transaction, but may result in the Gift Aid being disallowed. So keep records.
It’s basically anti-avoidance legislation, but it may potentially capture a lot of innocent transactions.
