Thirteen MPs currently donate to charities through payroll giving, according to data obtained by Civil Society through a freedom of information request.
The number donating through the Give As You Earn programme is down from 14 MPs last year, and amounts to 2% of the 650 members of parliament.
The Independent Parliamentary Standards Authority, which has set and administered MPs’ pay since 2011, said that of the 13 MPs currently using the scheme, eight are Conservative, four Labour, and one from the Scottish National Party.
MPs’ basic annual salary as of 1 April 2023 is £86,584. MPs also receive expenses to cover the costs of running an office, employing staff, having somewhere to live in London or their constituency, and travelling between parliament and their constituency.
Payroll giving lowest for seven years
Employees can use payroll giving to set up charitable donations directly from their wages to charities of their choosing.
HMRC’s UK charity tax relief statistics show that employees donated £128m through payroll giving in 2022-23, the lowest amount since 2014-15 and down from £137m in 2020-21.
Therefore, charities received £9m less through payroll giving last year, with money from that source dropping to its lowest in seven years.
Philippa Cornish, head of corporate clients at Charities Aid Foundation, said: “At a time when households and charities are stretched, unfortunately we are seeing a sustained decline in the number of people using these valuable payroll giving schemes.
“It is a unique and valued form of fundraising for charities, providing a regular income for planning ahead, with reduced administrative costs. The donation is tax effective on receipt by the charity so there is no need for the charity to claim gift aid.”
‘An under-utilised form of tax relief’
Nicole Sykes, director of policy and communications at Pro Bono Economics, said: “Payroll giving continues to be an under-utilised form of tax relief, which has generated very little change in the level of annual charity donations over recent years.
“Better use of payroll giving could help to alleviate some of the cost-of-living pressures felt by charities as a result of rising demand and lagging income.”
Sykes said that with “businesses more focused on purpose and the importance of creating social value than ever before, there is a clear opportunity for policymakers to encourage more companies to take up payroll giving and boost charity donations at a vital time”.
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