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The Chancellor announced changes in the March 2000 budget that make it more tax-efficient than ever before to make a charitable gift. By giving shares to the NSPCC it is possible to make a substantial tax saving, not only on capital gains tax but on income tax as well.
The relief from income tax is available for the full market value of the shares on the date of disposal. In other words, you will not pay income tax on the equivalent amount of your annual income in the tax year that the gift is made. This means that a higher rate taxpayer making gift of £10,000 worth of shares to a registered charity will receive income tax relief of 40 per cent of the full value, ie £4,000. In order to make these savings all you need to do is:
In order to qualify for the relief, the shares or securities must be listed or dealt on a recognised stock exchange, units in authorised unit trusts, shares in a UK open-ended investment company or holdings in certain foreign collective investment schemes.
In addition to income tax relief there is also full relief from capital gains tax, which means that in the hands of the NSPCC the gift is worth more than if you had sold shares yourself. The extent of the difference depends on how much capital gains tax you would have paid: there are some simplified examples below, but every donor's situation may be different and we advise consultation with a tax adviser/accountant to determine your own situation.
Gifts of shares can be transferred to the NSPCC either by completing a Crest Transfer form for each share holding and returning it to us together with the appropriate share certificate(s) or electronically if your shares are held by brokers under the Crest system.
In our experience some of our donors who are company directors have been concerned about the effect that an immediate sale of a significant number of their shares by the NSPCC would have on the share value.
1. The first way is for you to gift the shares to us in a controlled manner over a number of years. This may be advisable for personal tax reasons as well, because you need to ensure that you have enough taxable income in the year that you make the donation to offset against the market value of your gift.
2. The second way is for you to send us the share certificate in the name of the NSPCC and attach a letter with conditions as to when we can sell the shares. We will then simply hold onto them until the date you specify.
3. Alternatively, if you are unsure as to the value of your shares, you may want to consider sending them to Sharegift. This is a charitable organisation specialising in accepting small numbers of shares with low values, which would normally mean that they would not be economic to be sold. They aggregate the shares and then sell them distributing the funds to charity.
For further information or assistance, please contact our Supporter Care team on 020 7825 2505; by post to: 42 Curtain Road, London, EC2A 3NH; by email: supportercare@nspcc.org.uk Or contact Sharegift, 17 Carlton House Terrace, London SW1Y 5AH. Or download our Giving shares information.
Giving shares
(PDF,
113.1kb)
Copyright © 2006 NSPCC - All rights reserved. National Society for the Prevention of Cruelty to Children, Weston House, 42
Curtain Road, London EC2A 3NH. Incorporated by Royal Charter. Registered charity number 216401. NSPCC, charity registered in Scotland, charity number SC037717.