Tax Efficient Giving
If you are a UK taxpayer, there are a number of ways to give tax efficiently.
Donors can take advantage of tax breaks designed to encourage more giving to charity.
By supporting Imperial through a gift or shares, or through your will, and by claiming Gift Aid on your donation, your generous support for Imperial may also help you to reduce your tax bill.
Ways to give tax efficiently
Giving stocks and shares
One of the most tax efficient ways of supporting Imperial is through a gift of shares.
If you make a give shares to Imperial, you can claim full tax relief on their market value and any costs involved in making the gift, such as brokers’ fees. For example: if you are higher rate taxpayer and you give £1,000 worth of shares to Imperial, you will pay £400 less in income tax that year.
If the shares you donate have increased in value since you originally bought them, you don’t need to pay capital gains tax on the difference. (If the shares you donate are worth less than when you bought them, you cannot use this loss to offset any other capital gains tax liability.
For more information or to make a gift of shares
Please call Semiha Alma on +44 (0)20 7594 6149 or email email@example.com for help making the arrangements.
Gift Aid for higher rate taxpayers
If you are a UK taxpayer and pay higher rate income tax, the Gift Aid scheme allows you to claim back some of the tax on your donation.
When you make a donation under Gift Aid, we claim back the basic rate of tax paid on the donation – increasing the value to us of your gift by 25%. If you are a higher rate tax payer, it is then possible for you to claim back the remaining tax paid on the donation (that is, the difference between the basic rate and higher rate at 40% or 45%) through your tax return.
- Mrs Smith makes a donation of £100 to Imperial. She is taxed at the higher rate of 40%.
- We claim back £25 (equivalent to the basic rate tax paid on the donation), meaning the value of Mrs Smith’s gift to us is £125.
- Mrs Smith then claims back the difference between the basic rate tax (20%) and higher rate tax (40%) paid on her donation. Her claim should be based on the actual amount that we receive, rather than her initial donation – so £125 rather than £100.
- Paying tax at 40%, Mrs Smith can claim back £25 (that is, a difference in lower/higher rate tax of 20% on a donation worth £125). The scheme works in the same way for those who pay additional rate tax at 45% – but allows them to claim an additional 5%.
For more information
Giving in your will
A few changes to your will could reduce the amount of inheritance that needs to be paid on your estate – and leave a lasting legacy for the future of science and education.
Inheritance tax may become due on your estate if it is worth over £325,000 when you die. By making simple provisions in your will, the amount of inheritance tax payable can be significantly reduced:
- Imperial College London has charitable status for all UK tax purposes (HM Revenue and Customs reference number X2361) which means that bequests made to the College are wholly exempt from UK inheritance tax.
- Additionally, individuals who include charitable legacies in their will of at least 10% of their net taxable estate will benefit from a 36% rate of Inheritance Tax (IHT), a 10% reduction from the usual IHT rate of 40%. The net value of your estate is the sum of all the assets after deducting any debts, liabilities, reliefs, exemptions and the nil-rate band.
As with all tax planning, it is important to look at your own circumstances and seek advice as to how these changes will impact on your estate. You should consult a solicitor or financial professional to discuss structuring your will to reduce the tax burden on your estate.
For more information about making a gift in your will, please contact Anna Wall on +44 (0)20 7594 3801 or email firstname.lastname@example.org