Gift Aid is often missed for several reasons. One common reason is that donors may not fully understand how it works or may forget to make a declaration when making a donation. Sometimes, donors may not be eligible to make a Gift Aid declaration because they are not a UK taxpayer or because they have not paid enough tax to cover the amount of the Gift Aid claim.
Charities can also miss out on Gift Aid if they do not have clear processes in place for managing Gift Aid declarations and claims, or if they fail to comply with HM Revenue and Customs (HMRC) guidelines. This can result in the charity’s Gift Aid claims being rejected or delayed, and can cause unnecessary administrative burden and costs.
In some cases, charities may also be deterred from claiming Gift Aid because they believe it to be too complex or time-consuming or because they are concerned about the risk of making errors that could lead to penalties or reputational damage.
Overall, Gift Aid is a valuable source of funding for charities, and it’s important for both donors and charities to understand how it works and to take the necessary steps to ensure that it is not missed.
Below is a deeper look into the main reasons why Gift Aid is missed.