Section 521 | Gifts entitling donor to gift aid relief: income tax liability and exemption

(1)This section applies if gifts are made to charitable trusts by individuals and the gifts are qualifying donations for the purposes of Chapter 2 of Part 8 (gift aid).

(2)Income tax is charged on the gifts under this section.

(3)It is charged on the grossed up amount of the gifts arising in the tax year.

(4)But a gift is not taken into account in calculating total income so far as it is applied to charitable purposes only.

(5)The grossed up amount of a gift is the amount of the gift grossed up by reference to the basic rate for the tax year in which the gift is made.

(6)The trustees of the charitable trust are liable for any tax charged under this section.

(7)Schedule 19 to FA 2008 contains provision for transitional payments to charitable trusts in respect of gifts made in the tax years 2008-09 to 2010-11.^F1