BIM45160 | Specific deductions: gifts in kind and payroll giving: relief for gifts of trading stock to charities and other bodies - tainted charity donations
From HM Revenue & Customs · Business Income Manual
S and S Income Tax (Trading and Other Income) Act 2005 (); S-S Income Tax Act 2007 (); S, S Corporation Tax Act 2009 (); S-S Corporation Tax Act 2010 ()
No relief if unincorporated trader makes a donation considered tainted under Pt 13 Chap 8
Traders liable to Income Tax are able to obtain relief for donations of trading stock to certain bodies under . If the conditions are met, no amount is brought into account in calculating the trading profits in relation to the stock given away (see ).
However, these traders must consider the tainted charity donations rules as per and . The tainted charity donations rules do not apply to donations of trading stock by companies.
If the donation is tainted under these rules, no tax relief is available under . This means that there is nothing to prevent or from applying. These rules provide that where an item of trading stock is disposed of other than by way of trade, the amount that would have been received if the item had been sold in the ordinary way (the market value) should be included as a trading receipt for tax purposes (see ).