My reading of the rules for claiming Gift Aid on Small Donations – i.e. those given by visitors at the museum – is that it can only be done when there are at least 12 people in the museum at one time?
And more on GASDS! There were tricky rules about Community Buildings when it was first introduced, but you don’t need to worry. If you aren’t claiming as a Community Building you’re fine. You can potentially claim extra GASDS if you have a number of Community Buildings.
We are all volunteers and 70 years old plus and so our knowledge of modern technology is basic. We realise that we are missing out on some extra income but have the first idea of how to proceed.
Why not talk to your local CVS? Someone like that will be able to start you off and it’s not hard from there – honest!
Could you give some clear guidelines about how much of a Friends membership can be gift aided? In your experience, is an acceptable percentage?
This depends on what people get back. In practice it varies from 0 to 100%. It really does depend on what you are giving to your members – look at the value of that and split the fee between “charge” and “donation”. Take advice in each case.
If there is time could you ask for general advice on the advantages (or not) of claiming Gift Aid on admissions – thus using the exemption from VAT – against the benefits of charging VAT on admissions but reclaiming VAT on costs of conservation, restoration and operations. I am in particular considering the position of a working museum which successfully operates Gift Aid but has quite high running costs and can’t reclaim VAT if claiming Gift Aid.
My understanding of the cultural exemption is that it is not a matter of choice. If you are an eligible body, then admissions are exempt, and your museum fulfils those criteria. It is not dependent on whether or not you claim Gift Aid.
It would be a matter of doing some calculations. Is the amount of gift aid that you claim higher than the amount of irrecoverable VAT you suffer? What would the impact be of having to charge VAT on your admissions? And if you think it would be beneficial, then you would have to find some other vehicle for selling your tickets & managing the running costs so that you were in a position to operate VAT – but that would have to be commercially sustainable and not supported by charity funds.
Someone has donated an item to us (before my time and there is no formal paperwork). We have now decided that the best course of action would be to sell the item and put the money to our education programme. They would like to gift aid this money. If it still belonged to them, I am assuming we could sell it on their behalf and they could gift aid the money, as it was ‘donated’ however unofficially to us in the past, where does that leave us?
Unfortunately, Gift Aid can only be claimed on gifts of money – and as you say, this item was donated a while ago and so I can’t see a reasonable way around it. You can’t give it back for them to sell as the charity has a responsibility to its property.
And if it still belonged to them – they would have to sell it – because it isn’t a charity shop, selling something on their behalf is not allowed (HMRC clarified this a couple of years ago).
Sorry! Do ask around and see if someone else knows a good honourable loophole.
As I consult for a number of museums and heritage sites, I often come across venues that could benefit from introducing Gift Aid. What is the simplest way to set up a Gift Aid scheme – what steps would they have to take, what resources would they need and what issues should they look out for?
As with everything the actual mechanisms will depend on who is carrying them out – larger organisations will be likely to have software to manage their Gift Aid & donors, some organisations may use accounting packages that manage Gift Aid for them, and some may keep records on a simple spreadsheet, with declarations and correspondence neatly filed in a ring binder, but the basic principles are always the same. I’d talk to local museums about their systems to see the practicalities of what kinds of files they hold.
You don’t need to be large at all – I help a local choir and they find it’s worth doing gift aid for their 40 members and don’t find it hard. It is easier though if you have someone who is handy with a spreadsheet.
And the 1st 2 things I advise are bookmark this page https://www.gov.uk/claim-gift-aid and note down the HMRC helpline number 0300 123 1073 – other HMRC helplines may not have a great reputation – these people are lovely, answer quickly & are really helpful.
Following the GOV.UK guidance is pretty straightforward and I’m not sure that anyone has written it more clearly and concisely than their basic how to guide so start there and follow those steps.
In terms of resources – at a basic level, a few files, an ordered approach and a bit of confidence with technology (spreadsheets & submitting forms to HMRC) are all you need, but you can go as complex as you like with CRM systems and ticketing technology
The issues to look out for are
- the rules on admissions are counter intuitive, so check them out every time you are thinking of introducing gift aid, or a change to your entry fee structure http://bit.ly/giftaidadmission
- Benefits – always watch out for what you are giving back to people who are making donations because it is easy to be caught out by giving what you think is a simple thank you, but HMRC thinks is a valuable benefit. A reception for a company that has given you a donation for an event might well be seen as trading, and as a payment for a service not as a donation
There are some more museum specific tips here https://www.museumsassociation.org/campaigns/museums-and-tax/gift-aid-tips