What is Payroll Giving?
Payroll Giving (sometimes known as Give as You Earn) is an easy and tax-efficient way of making regular donations to your favourite charities straight from your pay.
What is Payroll Giving Week?
Payroll Giving Week happens once a year when Charities, Payroll Giving Agencies, Payroll Funding Organisations and Companies make a special effort to increase the awareness of Payroll Giving.
When is Payroll Giving Week?
The next Payroll Giving Week is 7th to 13th February 2022. Please help us spread the word and like / share / promote all the posts and messages you see on social media or in your company collaboration systems.
How can I do this?
Payroll Giving is super easy to set up. Ask your Payroll department or Benefits / CSR Team directly for how to get started. They will ask you to complete a form with the information about the donations you wish to make and giving your consent for the process to happen.
What does my company need to do?
Many companies will have an established process to help you with this.
Companies need to work with a Payroll Giving Agency to allow the process to be implemented. It is quick and easy to get this setup and an important part of their Corporate Social Responsibility.
What is a Payroll Giving Agency?
Payroll Giving Agencies facilitate the secure transition of funds from your gross wages to the charity’s bank account. Payroll Giving Agencies are themselves charities and they are authorised by HMRC to perform this function.
Your company needs to have a contract with a Payroll Giving Agency to allow donations to be deducted from your gross pay.
How much does it cost?
There are no set-up costs for employers.
Payroll Giving Agencies can charge a processing fee of up to 5% of the donation amount. However, some agencies don’t charge and some charge a transaction fee per employee.
You may choose to cover this fee for your employees otherwise the Agency will deduct it from donations. You can find a list of all approved agencies on the Gov.UK website.
Why is Payroll Giving a good thing?
Payroll Giving is a great way to enable the charities you care about to receive regular funds. It allows them to make plans and focus on their charitable objectives.
It is easy to set up and once it is done you can feel confident your money will be transmitted safely every month.
What does tax efficient mean?
By donating to charity from your gross pay it means there is no tax liability on your donation and you will pay less tax.
Donations made from gross pay also mean the charities you donate to don’t need to claim gift aid related to your donation.
Payroll Giving is especially efficient for higher rate taxpayers allowing for larger donations at a lower cost.
You will pay less tax!
The tax relief you get depends on the rate of tax you pay.
To donate £10.00 to charity it will only cost you:
£8.00 if you’re a basic rate taxpayer
£6.00 if you’re a higher rate taxpayer
£5.50 if you’re an additional rate taxpayer
(Scottish rates of tax are slightly different). It means you can consider increasing your donation because you are paying less tax.
Privacy
Donating to charities is a private matter. The Payroll Giving process allows you to keep the details of your donation private from your employer.
When making a donation to a Charity you can choose whether you share your contact details with the charity and tell them whether they can keep in contact with you.
More Information
If you would like more information on Payroll Giving please take a look at these resources:
Why is this important for Mildmay?
Payroll Giving is a very reliable source of income for us, allowing us to make solid plans for the future.
It also means funds are received quickly without the extra burden of having to claim Gift Aid from the government.