Donations that attract the right of free entry to charity property

Frequently asked questions

Contents

Q. Where a donor makes a donation that is 10 per cent more than the admission fee, is Gift Aid claimed for the whole payment or just 10 per cent?

A. The whole sum qualifies for Gift Aid

Q. We operate reduced admission charges for students, senior citizens, disabled etc – to qualify for Gift Aid would they have to make a donation 10 per cent more than the full admission fee?

A. No - to qualify for Gift Aid under this relief, a donation need only be 10 per cent higher than the amount that individual would pay for admission. You do need to bear in mind that many members of such groups will only have limited liability to income tax or capital gains tax and careful explanation of the need to pay sufficient tax may be required.

Q. To maximise Gift Aid, my charity will ask all visitors to make a donation that is 10% higher than the admission charge. Is this legitimate?

A. This approach can only be acceptable if it is absolutely clear that the "10%" extra is voluntary, that the net price or normal admission charge is clearly advised, and that Gift Aid claims are only made in respect of UK taxpayers. Non taxpayers can of course choose to make the donation, but Gift aid will not apply.

Q. My charity property only opens to the public for 6 months per year. Can we meet the requirement for unlimited access to be given for twelve months?

A. Yes, the legislation allows for this. Donors only need be admitted when the premises are open to the public during the twelve-month period.

Q. Is there any restriction on the number of special events we can run outside our normal opening hours?

A. Where you allow a right of unlimited access for 12 months during periods when the public are admitted you can restrict that right on up to five days. The 5 day restriction does not apply to additional events held outside of the times when you normally open your property to the public.

Q. What about a charity that demonstrates sports, crafts, mediaeval jousting, the playing of historical musical instruments or other enactments in costume? Would those activities be classed as performances, thus precluding Gift Aid?

A. So long as the activities are incidental to the visit or illustrative of the property then Gift Aid would still apply.

Q. My charity uses its historic premises to stage plays and concerts which relate to its period setting. Can we claim Gift Aid on the tickets for these events which are separate from the day visitors?

A. No. The events described are performances, which are excluded by the legislation from Gift Aid on visitor donations.

Q. Can visitors who aren’t taxpayers make donations and get the twelve-month admission?

A. Yes – the charity can offer membership schemes or season tickets, but of course Gift Aid will not apply to these donations.

Q. If a charity owns several properties – can the donor be given right of admission to all of those?

A. If there is an equivalent ticket available to the public but the visitor makes a donation that is at least 10 per cent more, then Gift Aid can apply. Or if the donation secures twelve-month admission to specified properties then Gift Aid can apply

Q. Currently we have reciprocal admission rights with other local charities. How will these be affected?

A. If there is an equivalent ticket available to the public and the donor pays 10 per cent more than the cost of that ticket, or if there is a reciprocal twelve-month ticket, then Gift Aid can apply.

Q. If we want to offer donors special season tickets, say for three months, can we do this?

A. If there is an equivalent ticket available to the public and the donor donates 10 per cent more than the cost of that ticket, Gift Aid can apply.

Q. If we offer the twelve-month admission how much does the donation have to be?

A. It will be for the charity to decide how much should be donated to secure twelve-month admission to its property. This might be through setting the level of subscriptions for a membership or friends scheme, or setting the price of an annual season ticket.

Q. We are considering a twelve month admission scheme where a donation, equal to the cost of a day admission, secures one free visit and repeat visits at reduced rates. May we claim Gift aid on payments in this scheme?

A. No. This scheme would in effect be an attempt to secure Gift aid without the 10% uplift and without the essential features of a membership scheme. This is contrary to the principles of Gift Aid and is precluded by the legislation:
An annual right of admission must be either:

Without payment of the admission fee

or

on payment of a reduced fee

The scheme proposed would offer free admission and reduced price admission. The same reduced (or free admission) must be applicable for the first and all subsequent visits.

Q. In order to encourage Gift Aid-able donations, my charity wishes to offer donors a free guide and/or send a newsletter to members. Will this violate the benefit rules thus barring Gift Aid?

A. So long as the guide, newsletter etc explains or otherwise relates to the charity property etc on view, and was issued to members only, we would not regard it as a benefit so the benefit rules would not be breached. Gift Aid would apply. The fact that the literature has a cover price and is also is on sale to members of the public is not relevant. This means that literature like newsletters, bulletins, annual reports, journals, members’ handbooks and programmes of events will generally carry no value for the purposes of the donor benefit rules.

Q. As an encouragement to potential donors my charity proposes to offer a gift e.g. a pen, brooch etc to those who make a donation to view. Will the benefit rules preclude Gift Aid?

A. Two alternatives illustrate the answer.

1. Normal admission price £10. Free pen worth £2 offered to donors who pay £11.00. The gift is within the benefit limit (less than 25 per cent of the value of the gift) so Gift Aid can apply.

2. Normal admission price £10. Free camera worth £6 offered to donors who pay £12. The Gift breaches the benefit limit (see above) so Gift Aid does not apply.

As stated above, the VAT position is different from the Gift Aid rules. Provision of a benefit means that VAT would be due on the whole of the donation.

Q. When a family ticket is used, must all the family members, including the purchaser, enter as a group?

A. No. The Gift Aid declaration will have been made when the ticket was purchased. Subsequent visits won’t affect that. If for example an adult who was included on a family ticket returned as a sole visitor later in the year using the family ticket, Gift Aid would be unaffected.

Q. Can we claim Gift Aid on group bookings?

A. Generally, no. The right of admission that Gift Aid can apply to extends to the donor or the donor and one or more family members. It did not extend to group tickets. However, there are very limited circumstances in which a group admission might qualify.

If each member of the group pays their proportion of the total amount due to the group leader as their agent and gives you a Gift Aid declaration (like a participant in a sponsored event) then Gift Aid will be available. What would not work is one person paying for the others and giving one Gift Aid declaration or one person paying for the others and each group member giving a declaration.

There are some important practical issues. You would have to give adequate explanations of Gift Aid to the group members to ensure that only those who are eligible use Gift Aid. You would have to ensure that your ticketing and accounting systems could cope with differing proportions of a group using Gift Aid - it would be easy if all or none used Gift Aid, but what if only three or seven out of ten did?

Q. My charity’s museum opens free of charge to the public but makes a charge to view temporary exhibitions of mainly loaned items from public and private sources. Can Gift Aid apply to these charges?

A. Yes, so long as the conditions detailed in this guidance are met.

Contacts for Further Guidance

Further guidance may be sought from the HMRC charities helpline

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The address for correspondence is
HM Revenue and Customs Charities
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Bootle, L69 9BB