An introduction to DAFs
Donor advised funds (DAFs) are the UK’s fastest-growing philanthropic giving vehicles. They offer several advantages over charitable foundations, namely cost savings, tax-efficiency, flexibility, and ease of administrative, fiduciary, and reporting requirements.
In most instances, individuals make an initial donation into a fund and then can top-up whenever they want. While the donations are irrevocable and become the assets of the managing charitable institution, the individual will advise the institution where they would like the money to go.
The due diligence to confirm the charitable purpose of the beneficiary organisation sits with the DAF manager, or their delegated authorities. Once that has been completed, the gift is then made on behalf of the DAF. Depending on the provider, other services and advice may be offered, including advisory services which can include strategic planning, impact measurement, and grant management.