Section 521 — Income Tax Act 2007: Gifts entitling donor to gift aid relief: income tax liability and exemption

Gifts entitling donor to gift aid relief: income tax liability and exemption 521 1 This section applies if gifts are made to charitable trusts by individuals and the gifts are qualifying donations for the purposes of Chapter 2 of Part 8 (gift aid).

2 Income tax is charged on the gifts under this section.

3 It is charged on the grossed up amount of the gifts arising in the tax year.

4 But a gift is not taken into account in calculating total income so far as it is applied to charitable purposes only.

5 The grossed up amount of a gift is the amount of the gift grossed up by reference to the basic rate for the tax year in which the gift is made.

6 The trustees of the charitable trust are liable for any tax charged under this section.

7 Schedule 19 to FA 2008 contains provision for transitional payments to charitable trusts in respect of gifts made in the tax years 2008-09 to 2010-11.