A charity recognised by HMRC can claim Gift Aid of 25p for every £1 an individual donates, as long as the donor has paid enough tax and has made a Gift Aid declaration. Where there is no declaration, the Gift Aid Small Donations Scheme (GASDS) lets the charity claim the same 25% on cash and contactless gifts of £30 or less. Both claims are made online through HMRC's Charities Online service.
The mechanics are not hard. The parts that go wrong are the records behind the claim, the types of payment people assume qualify, and the deadlines. This guide takes them in the order a treasurer meets them.
What Gift Aid is and how the 25p works
HMRC's guidance puts it in one line: you can claim back 25p every time an individual donates £1 to your charity or community amateur sports club (CASC). A CASC is a community sports club that HMRC recognises for tax purposes. The rest of this guide is written for charities, and CASCs follow broadly the same route with a few differences, which we flag where they matter.
The arithmetic is simple. Suppose someone gives £100. At the 20% basic rate of Income Tax, the gift is treated as a gross donation of £125 from which the donor has already paid tax, so the charity claims £25 from HMRC. The charity ends up with £125 and the donor's net cost is £100, exactly as if the donor had given £125 and claimed the tax back personally. Gift Aid exists so that the donor does not have to do that.
Two conditions come from the donor's side. HMRC says the donor must:
- have paid at least as much in Income Tax or Capital Gains Tax in that tax year as the Gift Aid you want to claim on their gifts; and
- make a Gift Aid declaration that gives you permission to claim.
The tax test is the donor's responsibility, not yours, but it is why the declaration matters. Higher-rate and additional-rate taxpayers can claim further relief through their own self-assessment returns. That relief belongs to them and does not change what the charity claims.
There is no annual cap on regular Gift Aid. The gift must be money, from an individual, a genuine gift with no condition about repayment, and any benefit the donor receives in return must stay within HMRC's limits.
Getting recognised by HMRC first
Gift Aid is only available to an organisation that HMRC recognises as a charity or CASC for tax purposes. Being on a charity register is a separate matter. The two are linked, but one does not give you the other.
If you have no online account with HMRC for the charity, you register and enrol for one. You then apply to HMRC for recognition as a charity entitled to claim UK charity tax reliefs. When approval comes, you receive a reference number and the date from which your entitlement to claim Gift Aid begins. That date matters. HMRC's guidance is explicit that you cannot claim on donations received before the date it accepts your organisation as a charity or CASC for tax purposes.
Regulator registration depends on where you are and how big you are:
- In England and Wales, a charity with income above £5,000 a year also registers with the Charity Commission.
- In Scotland, you apply to the Office of the Scottish Charity Regulator (OSCR).
- In Northern Ireland, a charity can claim Gift Aid once HMRC has granted charitable tax status.
Once recognised, you claim through Charities Online. You add it to the charity's HMRC online account. Alternatively, a charity can use an intermediary such as JustGiving to collect Gift Aid on its behalf.
What makes a valid declaration
The declaration is the donor's permission for you to claim. Without one, and without GASDS, there is no claim.
For a declaration form, ask for the donor's full name and address and the name of the charity. One declaration can cover every gift the donor makes, gifts over a period they choose, and gifts they have already made. That is useful for regular givers, because you collect it once rather than at every donation.
HMRC publishes example declaration forms for a one-off donation, for all donations, and for sponsored events. Start from those rather than writing your own wording. The exact words a declaration must carry are set by HMRC, and this is not a place for improvisation. If you take declarations online, through a donation page, or in some other way, check HMRC's current requirements for that method before you rely on it.
Sponsorship is the most common case for small charities. A sponsor form can work as a multiple declaration. Where sponsorship is eligible for Gift Aid, each sponsor must make a valid declaration. A workable sponsor form has columns for:
- the sponsor's full name;
- their full home address (as a minimum, HMRC accepts the house number or name and the full postcode);
- the amount pledged;
- the amount collected and the date collected; and
- a tick box for the amount to be treated as a Gift Aid donation.
A few sponsorship rules catch people out. The deposit or registration fee a participant pays before a challenge does not qualify. If a sponsor is connected to the participant, which means a spouse or civil partner, brother, sister, parent, grandchild, a relative's spouse, or a company the donor controls, their donations only qualify if the participant pays the full cost of the trip. HMRC does not expect you to check who is related to whom, but it does expect reasonable steps, such as saying so in your event literature and on the sponsor form.
Which payments qualify and which do not
The quickest way to an over-claim is to treat all money received as a donation. HMRC's list of payments you cannot claim Gift Aid on includes:
- payments for goods and services;
- donations of money from a company;
- gifts made on behalf of other people, such as a membership subscription paid for someone else;
- gifts that come with a condition about repayment;
- gifts that come with a condition that the charity buys goods or services from the donor;
- a minimum donation where the donor has no choice about paying;
- gifts made using charity vouchers or charity cheques; and
- donations received before HMRC accepted you as a charity or CASC.
Some examples in practice:
- Event tickets. A ticket is a payment for admission, so it does not qualify, even if it costs more than the event does. If you set a ticket price and also ask for a suggested donation, the donation can qualify, provided people can attend without giving it and donors get no preference. At a donation-only event, where people can attend whatever they give, all donations qualify.
- Raffles and lotteries. Tickets do not qualify, because the chance of a prize is a benefit.
- Membership fees. A charity's membership subscription qualifies only if it is for membership alone and does not give members personal use of the charity's facilities or services. Receiving your newsletter or taking part in activities that form part of the charity's objects does not count against you. CASC membership payments do not qualify, because members get personal access to the club's facilities.
- Collections in church. A church cannot claim Gift Aid on money collected for another charity, because that money is not the church's income. If the church sets up its own fund to raise money for the other charity, the money becomes the church's income and the church must claim.
- Volunteer expenses. Gift Aid applies only when a volunteer actually pays money to the charity. If a volunteer decides not to claim expenses they are entitled to, you cannot claim Gift Aid on that.
- School-linked fundraising. Non-uniform days can qualify if pupils may take part whether or not they give. If the payment is compulsory, it cannot be claimed.
If you sell donated goods on behalf of donors through a charity shop, there are separate Retail Gift Aid methods with their own paperwork. HMRC's guidance says you must read it to be sure you meet the conditions before claiming this way.
Records: what to keep and for how long
The central rule is that you can trace every pound you claim on back to a declaration. A claim must show a clear link between each donor's gift and their declaration, so that HMRC can check, if it wishes, that the donor existed and had paid enough tax. Larking Gowen, an accountancy firm, describes the expectation as being able to identify the credit in the bank account and the matching declaration, and to maintain an audit trail between them.
In practice, that means keeping:
- the signed or recorded declarations, filed so you can find the one for any donor;
- the record of each donation, with date and amount, that links to the declaration; and
- a copy of each claim you submit.
For retention, plan on at least six years. Larking Gowen puts the period at six years from the end of the tax year (for a trust) or financial year (for an incorporated charity) in which the donations were made. Where one declaration covers a stream of gifts, it is safest to treat it as live until six years after the last donation you claimed on. Charity committees change, so keep records somewhere a successor can find them, and look after the personal data in them under data protection rules.
How you keep your books also affects how easily you can show this trail. If you are deciding between receipts-and-payments and accruals accounts, our piece on receipts and payments or accruals accounts sets out the choice.
Making the claim online
HMRC says you can claim Gift Aid online and should get your payment within 5 weeks.
There are two ways to build the claim. You can use eligible software, such as a donor database, or a spreadsheet of your donations. The spreadsheet is downloaded from HMRC's website, completed with each donor's details and the amount of their gifts (taken from the declarations), and uploaded to your Charities Online account. If a claim covers more than 1,000 donations, you must use software. A paper route exists using form ChR1, available from HMRC's charities helpline.
The four-year deadline
A Gift Aid claim must be made within four years of the end of the financial period in which you received the donation. What counts as the period depends on the charity's legal form:
| Type of charity | Period the four years run from | Example |
|---|---|---|
| Trust | End of the tax year (6 April to 5 April) | A gift received on 10 June 2023 falls in the tax year ending 5 April 2024, so the claim must be in by 5 April 2028 |
| CASC, Charitable Incorporated Organisation (CIO) or limited company | End of the accounting period | A gift received in March 2024 in a year ending 31 December 2024 must be claimed by 31 December 2028 |
The time limit is generous enough that a charity that has never claimed may still have recent years open. It is also short enough that old gifts expire. If you have been receiving declarations but not claiming, check which years remain open and claim the oldest first.
The Gift Aid Small Donations Scheme
Many small charities take cash from collection tins, bucket collections and fundraising events, where getting a declaration from every giver is not realistic. GASDS is for that. It lets a charity or CASC claim top-up payments on small donations of £30 or less, with no need to know who the donors are or to collect declarations.
The scheme covers cash donations, meaning coins or notes of any currency that have been collected and banked in the UK. Since 6 April 2017 it has also covered donations made by contactless card. The limit for each donation rose from £20 to £30 on 6 April 2019.
The top-up is worked out like Gift Aid. At a 20% basic rate, a £30 gift earns £7.50.
What you must have done to claim
For donations collected from 6 April 2017, HMRC's conditions are:
- you have claimed Gift Aid in the same tax year as the one you want a GASDS top-up for; and
- you have not had a penalty on a Gift Aid or GASDS claim in the current or previous tax year.
You cannot use GASDS for donations that come with a valid Gift Aid declaration, for membership fees, or for a £30 slice of a larger gift. You also cannot claim Gift Aid and GASDS on the same donation. A single £80 cash gift is therefore not a small donation, even though you could ask the donor for a declaration and claim it as ordinary Gift Aid.
How much you can claim: the £8,000 and the matching rule
The annual limit is on the donations you claim on, not on the payment. HMRC's rule is that the maximum is the lower of:
- £8,000 of small donations; or
- 10 times the amount you receive in Gift Aid donations (the matching rule).
At the 20% basic rate, £8,000 of small donations produces a top-up of £2,000.
The matching rule is what limits small charities. Take two charities:
- Charity A receives £2,000 of donations with declarations. Ten times that is £20,000, which is above £8,000, so the cap is £8,000 of small donations. Its GASDS top-up is up to £2,000, on top of £500 of ordinary Gift Aid.
- Charity B receives £400 of donations with declarations. Ten times that is £4,000, below the £8,000 limit, so the cap is £4,000 of small donations and the top-up is up to £1,000.
The practical conclusion is that if your bucket collections are healthy but your declarations are thin, collecting more declarations raises your GASDS headroom as well as your ordinary Gift Aid. You must claim both Gift Aid and small donations in the same tax year as you receive them to satisfy the matching rule.
Community buildings and connected charities
Charities that run activities in community buildings may be able to claim on more than £8,000. A charity with two or more community buildings can choose to claim a maximum of £8,000 on either small donations collected anywhere in the UK, or small donations collected in the same Local Authority area as each community building. The activities in the building must include at least 10 people who benefit, take place at least 6 times a year, be open to the public, and have no entry fee. The community buildings rules do not apply to CASCs.
Charities that are connected, meaning they have the same or very similar purposes and activities or are controlled by the same or connected people, share a single allowance rather than claiming separately. Having a trustee in common with another charity does not make two organisations connected if their aims and activities are largely different.
Records and the claim itself
You need records of small donations to support the claim. HMRC asks that two people ideally check and count the cash collected, and that you record:
- how much was collected, including each denomination of coins and notes;
- the date it was collected; and
- that no individual donation was greater than £30.
For contactless donations, keep the records produced by the card terminal. Keep these records for 6 years from the end of the tax year they relate to.
You claim through Charities Online, and you need to do so within 2 years of the end of the tax year in which you collected the donations. You give only the total amount of small donations, not donor details. If HMRC overpays you, you include the incorrect amount on your next claim and HMRC deducts it from your next repayment.
A sensible habit is to file the GASDS claim at the same time as the Gift Aid claim, and to keep a one-page reconciliation for each tax year showing total small donations, the maximum the matching rule allows and the figure you claimed.
Common mistakes that cost money
Most reduced or repaid claims trace back to a short list of causes:
- Claiming on tickets, raffles and other payments that buy something. If the donor gets a benefit over HMRC's limits, the payment does not qualify.
- Claiming on company gifts. A charity cannot claim Gift Aid on a donation from a company.
- Claiming before recognition. Donations received before the date HMRC accepts you do not qualify.
- Weak links between donations and declarations. If you cannot show which declaration covers which gift, you cannot show that the claim is right.
- Missing the deadlines. Four years for Gift Aid from the end of the relevant period, two years for GASDS from the end of the tax year.
- Claiming GASDS without a Gift Aid claim in the same year. The scheme depends on it.
- Putting a gift in both schemes. A donation can go through one or the other, never both.
- Treating larger gifts as small donations. A £30 slice of a bigger gift does not qualify.
- Poor records of cash counts. Without a count sheet or terminal record, a GASDS claim cannot be supported.
If you find you have over-claimed, the correction for GASDS is to include the incorrect amount on your next claim. For anything else, speak to HMRC's charities helpline before you submit another claim.
Frequently Asked Questions
How long does it take to get paid after a Gift Aid claim?
HMRC says you should get your payment within 5 weeks when you claim online.
Can a small charity claim Gift Aid on cash in a collection tin?
Yes, through the Gift Aid Small Donations Scheme, as long as each donation is £30 or less, you have claimed Gift Aid in the same tax year, and you have had no penalty on a Gift Aid or GASDS claim in the current or previous tax year. Donors do not need to make a declaration.
Do we need a declaration for every gift?
No. One declaration can cover every gift a donor makes, past gifts included. It does need the donor's full name and address and the name of the charity.
How far back can we claim Gift Aid?
Four years from the end of the tax year (for a trust) or accounting period (for a CASC, CIO or limited company) in which you received the donation.
Can we claim Gift Aid on membership fees?
A charity can, if the subscription is for membership only and does not give members personal use of the charity's facilities or services. CASCs cannot claim Gift Aid on membership payments. Neither charities nor CASCs can use GASDS for membership fees.
Where this leaves a small charity
The order is straightforward: get recognised, collect declarations that follow HMRC's example forms, keep a trail that links each gift to its declaration, claim within the four-year limit, and file GASDS alongside it with a proper cash-count record. Done routinely, the claim is a short job each period.
If you want the charity's accounts and tax handled alongside Gift Aid, Deplexify prepares accounts and tax for UK charities; the details are on our charities page. If you are also checking what level of scrutiny your annual accounts need, see our note on independent examination thresholds.
Sources
- Claiming Gift Aid as a charity or CASC: Overview - GOV.UK — gov.uk, read 2026-10-19
- Claim top-up payments for the Gift Aid Small Donations Scheme - GOV.UK — gov.uk, read 2026-10-19
- Gift Aid donation claims for charities and CASCs - GOV.UK — gov.uk, read 2026-10-19
- PTA+ Claiming Gift Aid from HMRC — pta.co.uk, read 2026-10-19
- A Comprehensive Guide To Gift Aid | GWD — gwd.team, read 2026-10-19
- Gift Aid: Maximise Donations for Your Charity — ciof.org.uk, read 2026-10-19
- Gift Aid: What it is and how to claim | Larking Gowen — larking-gowen.co.uk, read 2026-10-19
- GASDS Explained: Claim Gift Aid on Cash and Contactless | Charity Platform — charityplatform.com, read 2026-10-19