In 2011/12, 735,000 people made tax-free donations of £118 million to charity, directly from their pay or pension through payroll giving.
However, only 2% of employers offer this scheme and only around 3% of employees are making regular donations. The government believes that there is scope to increase this by simplifying the scheme’s administration and making it easier for donors to give.
The government’s proposals include:
- allowing non-charities to become Payroll Giving Agencies (PGA) – the intermediaries which handle the transations involved in payroll giving – to allow new agencies to invest in and improve the system
- reducing the maximum time between the PGA receiving money and paying the charity from 60 to 30 days, to make sure charities get donations faster
- bringing in standardised forms for donors and employers to make sign-up simpler.
Nick Hurd, Minister for Civil Society, said: “We want to explore ways that make giving to good causes easier and help build better connections between business and charities. Payroll giving is an underdeveloped opportunity. This consultation is focused on how we can make it work much better for donors, employers and charities.”
The consultation closes on 19 April 2013. For more information go to the HM Treasury website.
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