More than just the ticket - here's why!

How do you feel if asked to pay 10% extra on your ticket price so that gift aid can be claimed? Confused if you’re like me! Once or twice now I’ve been visiting a museum, gallery or even zoo and been invited to pay 10% more than the ticket price so Gift Aid can be claimed. Never has the person making the invitation been able to explain why.

Then someone I respect hugely, who runs a large third sector support organisation told me he’d refused to pay extra so that Gift Aid could be claimed. He didn’t understand why either. So I decided to find out because Gift Aid should be claimed wherever possible. After all, it increases charity income by 25% on qualifying gifts.

Let’s start with the basics. Gift Aid enables charities (and Community Amateur Sports Clubs) to claim 25% extra from HMRC on donations made by UK taxpayers from their taxed income. In other words, you take the donation and divide by four to calculate the Gift Aid you can reclaim. The donor signs a simple form to confirm that they are UK taxpayers and are paying from taxed income.

To make it easier for small charities, £5,000 of donations received can qualify for Gift Aid without any donor paperwork, providing none of them were for over £10.; useful bonus that can be added to collecting tin income.

And why ask for more to claim Gift Aid? Well the answer’s hidden in the HMRC Gift Aid guidance here . Para 3.38.11 describes the ‘admission charge plus 10% option’.

‘This option applies where a member of the public could purchase a right of admission, but instead chooses to make a gift that is at least 10% more than the admission charge, and in return for that donation the charity grants the equivalent admission to view charity property. The whole amount received from a donor is treated as a donation for Gift Aid purposes, not just the additional 10%.’

So if you charge £10 entry to your museum, garden, zoo, art gallery, ancient site or ‘scientific property’, if your visitor chooses to pay an extra £1.00 as a donation, you can claim 25% of £11 as Gift Aid – that’s £2.75; a total income of £13.75 on a £10 ticket.

What are you waiting for?

Social enterprise - it's all graft!

I was recently challenged to enter what to me seems a pointless debate. The instigator was seeking agreement that charities are not businesses and thus cannot be considered social enterprises. His motivation for starting the debate was sound; he feels I believe that too often social enterprise is seen as a kind of ‘enterprise lite’, and considered by many charitable rather than commercial.

He has a point. I’ve long been suggesting that tomorrow’s successful social enterprises are likely to be grown from corporate rootstock. Too many grafted onto existing charities fill struggle to achieve their potential. 

Of course there are many exceptions, including a number of go-ahead charities I am working with to develop trading income. But for the most part, I see the corporate landscape having the depth of resource and intellectual nutrients necessary to cultivate a strong crop of what we might today call social enterprises.

It’s time we separated governance and structure from activity and focus. Yes, of course all organisations need to remain compliant with the legal parameters that define their existence. But to categorise them and suggest that some are ‘businesses’ and some not is not helping further the cause.

Talking to Nick Donohue recently, one of the people setting up the Big Society Bank and you realise that Government have got this one right. Loans from the bank will be available to organisations with a robust plan and a commitment to invest their profits in delivering social good. They have no hang ups about structure and nor should we!