Did you know a higher rate tax payer can reduce the amount of income tax they pay by donating to charity?
If you pay tax above the basic rate, you can claim the difference between the rate you pay and basic rate on your donation.
You can do this either:
- Through your self-assessment tax return
- Asking HMRC to amend your tax code
“If you donated £150 to charity, the charity can claim Gift Aid to make your donation £187.50,” said Peter Way-Rider, tax manager at Ellis & Co Chartered Accountants and Business Advisers.
“Higher rate tax payers can then claim back £37.50, as you pay 40% tax.”
For further information on this or any other tax matter, contact Ellis & Co on 01244 343504.