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Monday, 22 June 2015

Member Blog: Payroll giving schemes and skills-based volunteering – A way to strengthen the North West’s Voluntary Sector

By Ashlie Tottle - Communications and Marketing Manager, The Charity Service


The National Council for Voluntary Organisations’ (NCVO) UK Civil Almanac 2015(1), reports that in 2012/13 the voluntary sector contributed £12.1bn to the UK gross value added (GVA), a calculator used by the Office for National Statistics which estimates the value of production or output similar to Gross Domestic Product, comparable to the £8.3bn GVA of the agriculture sector.

More than a million employees made donations to charity through a workplace Payroll Giving scheme in 2012/13, according to revised figures by HM Revenue and Customs (HMRC) and there was a rise in total receipts received and distributed by payroll giving agencies to UK charities from employees donating from their pre-tax pay from £118mn in 2011/12 to £155mn in 2012/13(2).

Whether donating to a charitable cause is driven by a personal ethos or sits as part of a businesses corporate social responsibility agenda, to give to charity via a regular donation through a payroll giving scheme is a tax efficient way to give and a valuable regular income stream for the charity. Payroll giving software allows for pre-tax deductions with monies taken directly from an employees’ wages. It gives the flexibility to give to a charity of choice and more than one charity if desired.

Scenario 1
You are taxed at 20% and want to give £10 per month to charity
You pledge £10 to the charity of your choice
The actual cost to you as the employee is £8.00
The tax benefit adds £2.00 bringing the donation up to £10

Scenario 2
You are taxed at 40% and want to give £10 per month to charity
You pledge £10 to the charity of your choice
The actual cost to you as the employee is £6.00
The tax benefit adds £4.00 bringing the donation up to £10

An organisation can apply for a Payroll Giving Quality Mark(3) to recognise their commitment to the scheme and once they reach a certain level of participation are eligible to apply for a Bronze, Silver, Gold or Platinum Award.

Payroll giving schemes, skills-based and employee supported volunteering as part of a corporate social responsibility policy can create positive PR leading to customer brand loyalty, improve staff moral and develop a health community which is essential to business.

Alex Whinnom CEO of Greater Manchester Centre for Voluntary Organisation (GMCVO) is an advocate of payroll giving schemes as managed by The Charity Service and other agencies, supporter of Resonate Connect a new initiative to increase employer supported volunteering, and local “4 Goods” like TamesideWigan and Salford: “One percent of big names receive half of all charitable giving yet local good causes make such a difference to residents and communities in our city. Let’s give them more support!”

For further details about The Charity Service's payroll giving service visit  
http://www.charityservice.org.uk/our-services/services-for-business/payroll-giving/ or contact Ashlie Tottle, Communications and Marketing Manager: 
Email - Ashlie.tottle@charityservice.org.uk 
Mobile - 07730 217 954


 (1) NCVO UK Civil Society Almanac http://data.ncvo.org.uk/a/almanac15/economic-value/
 (2) Payroll Giving Centre http://www.payrollgivingcentre.com/facts%20figures.htm
 (3) Payroll Giving Centre http://www.payrollgivingcentre.com/quality%20mark%20awards.htm

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