A good dig around on hmrc's website gives:
'3.8.4 Subject to the benefits rules outlined below in Section D, outright payments to a charity in return for services, rights or goods are not gifts to charity and so are not eligible for Gift Aid tax relief. For example, the following cannot come within the Gift Aid scheme:
Payment
for admission to events (jumble sales, concerts etc)
So, no then. Never mind
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there may be ways.
as an example sell raffle tickets, the prizes for which are entry to the ball. Is there a rule about how many tickets can fail ?
I remember doing this to get around licencing rules (red ticket or white ticket ?) for a small do.
payment for membership (1 weeks membership, members get free entry? )
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There is no way of getting round that. My mother helps organise a string of concerts for a major charity (venue, performers etc. all donated). They cleared it with head office's lawyers that it was all donation so could be gift aided.
With a Ball you're into much more difficult territory as there is a clear benefit received from the tickets.
With a raffle you're beyond the grey area, and into clear black and white. You are getting a raffle ticket for your money so you CANNOT gift aid it.
If you trust your ballgoers, perhaps you can sell the tickets for £10 to cover food & room hire. Suggest they might make a donation at the same time as buying the tickets.
So far as selling red & white raffle tickets goes, it does not work to avoid the licensing laws. Selling a red raffle ticket is as good as selling a red glass of wine. The advice given to me by a former Mayor of Cambridge was 'just break the law, they're not interested in prosecuting small fund-raising one-off events'. Somebody else once pointed out that if you do apply for an occasional permission (or whatever they're now called) you might end up with the police sitting outside the gate at the end, pulling people over to blow into this bag please sir. Please no debate on the ethics of drink driving here.
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It would be very surprising if at least one of the parents of the children at the school was not connected with accountancy.
Perhaps the school staff may be aware of someone who may be able to answer the query?
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What\'s for you won\'t pass you by
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The following comes from the HMRC guidance at
www.hmrc.gov.uk/charities/guidance-notes
in section F. Simply put the examples show that you have a problem. Incidentally I cannot see how attendance at a concert is also not a benefit and whilst I congratulate the charity discussed above I do not think that you can rely on that position.
3.52 Charity Events
3.52.1 Charities often hold events (dinners, concerts, firework displays, etc.) to raise funds and ask whether all or part of the payment to attend the event can be Gift Aided.
3.52.2 To be eligible for the Gift Aid scheme a payment must be a freewill gift to charity, that is, there must be no compulsion about making the payment. So the payment must be a wholly voluntary payment and not linked to attendance at the event.
3.52.3 A payment to purchase a ticket (or an admission charge) to attend a charity event is not a gift to charity but the purchase of a right to attend the event. Without buying a ticket you cannot attend the event, so there is no freewill in making a payment - that is, you must pay the ticket price to attend the event. Such payments are not eligible for Gift Aid.
3.52.4 In the same way a payment described as 'minimum donation' or a 'donation' to attend an event is not a freewill payment. Again, you must make the payment to attend the event. The 'minimum donation' or 'specified donation' is, in fact, an admission charge.
3.52.5 The following payments to attend an event are not gifts to charity:
Payment to purchase a ticket.
Payment to gain admission.
A required minimum donation.
A required specified donation.
All of the payments described must be paid in order to attend the event and so are not freewill gifts to charity. Such payments are not eligible for the Gift Aid scheme.
Ticket price plus a suggested donation
3.52.6 A charity can charge what it likes for a ticket to attend its event. However, it should not put the charity's funds at risk and, therefore, should set the ticket price at a level to at least recover its costs.
3.52.7 A charity can, therefore, charge a set ticket price (not Gift Aidable) and, in addition, request a donation that can be Gift Aided. However, any suggested donation:
Must not be compulsory such that it has to be paid, in addition to the set ticket price, to attend the event. That is, the payer must be able to pay only the ticket price to attend the event; and
The payer must be aware of that at the time he makes the suggested donation (the ticket and/or event literature must make it clear).
3.52.8 As explained earlier, a payment described as a 'minimum donation' or a 'specified donation' that has to be paid in addition to the set ticket price is not a freewill gift and cannot be Gift Aided. In these circumstances, the set ticket price plus the minimum donation or the specified donation is the actual ticket price and no part of the payment made (ticket price plus minimum/specified donation) can be Gift Aided.
Examples
A charity organises a dinner dance and incurs the following costs:
Hire of venue = £1,000
Catering costs = £3,000
Orchestra/singer = £2,000
Total costs = £6,000
The proposed number of attendees is 100 and the charity wants to make (say) £4,000 on the event.
The cost per attendee is £60 (£6,000 / 100) and so the charity is looking at a set ticket price at £100.
Example 1
The charity charges £100 for each ticket.
There is no gift to charity, all the proceeds (£10,000) are from ticket sales and none qualify as Gift Aid payments.
Note: Sometimes a charity seeks to claim Gift Aid on the £4,000 (£40 per person) on the basis that the amount over and above the costs is a donation. However, the £4,000 (proceeds £10,000 less costs £6,000) is a profit and not a donation.
Example 2
The charity charges £65 per ticket and also asks for a minimum donation of £35.
To attend the dinner an attendee must pay £100 (£65 + the minimum donation of £35). You cannot attend by only paying £65.
There is no gift, the whole of the £100 is a compulsory payment to attend the dinner and no part of it is eligible for the Gift Aid scheme. Any voluntary donations over and above the compulsory £35 will be eligible for Gift Aid.
Example 3
The charity charges £80 per ticket and, in addition, asks for a suggested donation of £20. The charity makes it clear on the back of the ticket that the £20 is only a suggested donation and that attendance at the dinner can be obtained by only paying the set ticket price of £80.
The £80 paid for the ticket cannot be Gift Aided.
However, as the charity made it clear that a payment to attend the dinner was only £80 (the set cost of a ticket) then any payment made in excess of the £80 can be Gift Aided. So the suggested £20 donation or any other donation in excess of the £80 paid for a ticket can be Gift Aided.
Example 4
The charity charges £100 for each ticket. However, a benefactor pays the full cost (£6000) to the charity so that it can pay for the dinner.
For Gift Aid purposes, the situation is exactly the same as for Example 1.
Who meets or how the costs are met is not important when determining whether a payment to attend the dinner is a gift. The charge to attend the event remains at £100 even though the charity's cost are met by the benefactor. So none of the £100 payment can be Gift Aided.
Note: The benefactor has made a gift to the charity of £6,000 and so he can Gift Aid his £6,000 gift provided all the requirements of the Gift Aid scheme are satisfied. Any free tickets (£100 each) given to the benefactor are benefits for the purposes of the Gift Aid benefit limit (£150 for a £6000 donation) - so 1 free ticket valued at £100 is within the Gift Aid benefit limit.
Example 5
The charity charges £100 for each ticket. However, the venue/orchestra/caterer all waive their charges and so it costs the charity nothing to put on the dinner dance.
None of the £100 paid can be Gift Aided as it is a payment to purchase a ticket to attend the dinner.
Unlike example 4, the venue/orchestra/caterer cannot Gift Aid their contributions because they have not made any payments to charity but simply waived their fees.
Example 6
The charity decides that it will not make any charge to attend the event and will rely on expected donations to more than cover costs.
Charity trustees are obliged to take proper care of charity funds and not expose them to undue risk. Any trustees considering this kind of approach would have to be able to demonstrate that they had made a properly informed and considered decision that a better return on funds laid out could be achieved by not charging for tickets. Failure to do this could result in the costs being treated as non-charitable expenditure and the trustees being personally liable for any loss of funds. Professional advice should be taken before embarking upon such a course. Donations received in such circumstances would be eligible for Gift Aid.
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Sorry if I didn't make that clear, hxj. They clearly fall under your example 6 as the ticket price is nil and they entirely rely on donations. Interestingly, making a 'suggested minimum donation' means they take more cash than when they charged a going rate.
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