The Big Society
PUBLISHED: 15:31 13 June 2011 | UPDATED: 19:32 20 February 2013
Can the Chancellor's new Inheritance Tax incentive help make charitable giving the norm in the UK, or can we encourage people to donate their time instead?
The Big Society
Can the Chancellors new Inheritance Tax incentive help make charitable giving the norm in the UK, or can we encourage people to donate their time instead?
As I watched the thousands of runners taking part in this years London Marathon, I couldnt help thinking about the Big Society and what it would mean to them as they pounded the streets.
The first area within the Big Society agenda is promoting social action so that more people will look for opportunities to make a difference with their time and money. How many people watched the marathon and thought I can do that? And how many will actually take that step and go for it?
A recent survey commissioned by Parkinsons UK found that 61 per cent of the population have never volunteered and half said they had never fundraised before. A third said they had no interest at all in helping charities.
This must make uncomfortable reading for those involved in running charitable organisations who have suffered a drop in cash donations as a result of these financially difficult times.
So can we encourage people to donate their time? There are a number of volunteer centres across the county who can put prospective volunteers in touch with charitable organisations in need of support and businesses can also help out as part of their Corporate Social Responsibility (CSR) programme.
Here at Whitehead Monckton we recently organised a 20km endurance race in the local shopping centre in aid of Comic Relief and we will be hosting another coffee morning in aid of Macmillan Cancer Support in September. Employees can also donate direct to charities of their choice through Payroll Giving before tax is deducted from their salary.
The Chancellor, George Osborne, has said he wants to make charitable giving the norm in this country and has introduced an incentive Inheritance Tax purposes. From April 2012, if you die leaving at least 10 per cent of for your net estate to charity, then any Inheritance Tax payable on your estate will be subject to a 36 per cent rate, rather than the standard 40 per cent.
Will this encourage more people to give more to charity? Or will this only benefit those who were thinking of doing so anyway? Only time will tell, but any incentive has got to be good news for charities who, like most of us, are feeling the pinch at the moment. The Chancellor has estimated that the charities will be better off to the tune of 300m as a result of this incentive alone.
The Budget also introduced reforms which will enable charities to claim Gift Aid on donations totalling up to 5,000 per charity without any paperwork. It is estimated that this will benefit charities in the sum of 240m.
We have a Charity and Social Enterprise Team here at Whitehead Monckton comprised of experts in the trust, commercial, employment and property fields. From wealthy clients wishing to create their own charitable trusts, to those acting as Trustees of bigger organisations, we are involved in a number of ways in projects which are very much part of the Big Society.
Kerin Speedie is a partner at Whitehead Monckton specialising in tax planning, wills and the administration of estates. She is a member of the Society of Trust & Estate Practitioners as well as Solicitors for the Elderly.