1 CHARITIES GET MORE OF YOUR DONATION
Payroll giving comes out of your salary after National Insurance, but before tax. This means that you get tax relief on your donation which can be passed onto your charity. If you’re a higher tax rate payer then this benefit increases. Here’s an example of how it works:
You’re a standard tax payer at 20% and make a monthly donation of £20 to your chosen charity. When the money is taken from your salary you’ll be paying £16 but the remaining £4 will be money you would have paid in tax and not seen in your wages anyway.
You’re a higher rate tax payer at 40% and wish to make a monthly donation of £20 to your chosen charity. When the money is taken from your salary you’ll be paying £12 but the remaining £8 will be money you would have paid in tax and not seen in your wages anyway.
You can find out more about the tax benefits on our CAF Give As You Earn page.