Donations website JustGiving has said it was ordered not to apply gift aid to donations on its website signed off with messages of support by more than one person, such as "love from mum and dad" - at a cost of millions to charities.
The resulting loss of gift aid to charities is in the region of £1m to £2m a month, with up to one in four donations passing through the site affected, according to JustGiving.
A statement by the donations site said it was instructed by HM Revenue & Customs to retrospectively untick the gift aid boxes of any donations with support messages by more than one person last November.
“Late last year, JustGiving experienced a spike in gift aid rejections after a more stringent application of regulations by HMRC,” the statement said.
“Whilst HMRC assured us this was part of a sector-wide attempt to improve the way gift aid is applied, it particularly affected social giving, where individuals want to leave messages of support for fundraisers that include other close family members.”
According to JustGiving, the restriction was lifted in the last fortnight “as part of a series of ongoing changes” by HMRC which specify that family members of up to four people can now sign off a message on the site.
A spokesman for HMRC initially told Civil Society News today: “There has never been any restriction. Family messages of support have always been fine with HMRC on individual donations.
"We want Gift Aid claimed on as many eligible donations as possible. All individuals donating to charity, even if their donation includes additional names to a supporting message, can claim gift aid to boost their donation. We work very closely with charities to ensure the gift aid rules are applied correctly and they receive the full benefit of all donations."
HMRC later issued a further statement, saying they could not comment on the JustGiving case specifically – or any directions given by HMRC to the fundraising site.
“We don’t discuss individual cases,” the spokesman told Civil Society News. “We are not going to discuss what we have said to you as a taxpayer or what we did or did not say to another intermediary. The key point is that individual donations are always gift aidable and the rules are completely unambiguous and to the point.
“If it’s an individual donation then it’s fine, someone can put a message from mum, dad, all their children if there are 40 kids, we don’t care, as long as it’s an individual donation. The whole point is that a gift aid has to come from an individual who is a tax payer.”
