INTRODUCTORY OVERVIEW

Donations and legacies

Legacies and donations are money given as a gift, with no expectation of anything in return. This kind of income is particularly useful as it generally comes ‘without strings’. It is given freely and can be spent (or not) as the organisation sees fit.

The total amount given to charities by individuals in 2005/06 is estimated at £8.9 billion. It is estimated that almost 60% of the population give to charity in an average month.

Charities Aid Foundation ,
UK Giving 2005/06.

 

Large household name charities get a lot of their income from these sources.
Small and locally based voluntary and community organisations attract most of their donations through carrying out community fundraising activities rather than methods like payroll giving or legacy fundraising which bigger name charities are better placed to develop.

One key issue for both these forms of income is the tax relief available for charitable donations. Charities can recoup tax on donations from UK tax payers by registering with HM Revenue and Customs and using the Gift Aid scheme.