British charitable donations have almost doubled over the past 18 months as Britons dig deep in the face of international humanitarian disasters. New research from Bacs, the company behind the Direct Debit service in the UK, suggests over the past year British people have donated an estimated £6.2 billion (1) – almost double the £3.2 billion donated in previous years (2).
However, potential charity benefactors are still missing out on more than £419 million (3) per annum as British taxpayers fail to take advantage of tax breaks afforded to charities.
Michael Chambers, Managing Director Bacs, said: “It is heart-warming to see the generosity of our country, particularly in the face of tragic events in Asia. However, unless we give tax-effectively using gift aid the full potential of our donations are not being realised.
“Direct Debit is an effective way to donate on a regular, controlled basis and makes it easy to help charities take advantage of tax breaks – donors simply need to contact their chosen charity to organise donating via Direct Debit and opt-in to the gift aid option. It is such as easy step, yet close to a third (32%) of donors do not know what gift aid is and continue to give in non tax-efficient ways.”
International aid and humanitarian causes, such as the tsunami appeal, was the most common type of charity cited by donors (62%) that they had given money to over the previous 12 months.
Overall more than eight in 10 (84%) GB adults donated to charity last year, giving an average of £158 - a significant rise from the £82 average of 18 months ago. Women proved the most generous, giving £173 on average compared to men’s £142 a year.
However both sexes admit recent events, such as the Asian tsunami disaster, have prompted them to give more than they usually would (59%).
The main motivation for donating to charity appears to be helping other people (68%), followed by wanting to make a difference to society (28%) and wanting to share money with those less fortunate (27%).
People from the East Midlands give most to charity donating £297 a year, with the North West finishing bottom of the donation league table.
Any tax-payer wishing to increase the value of their donation to their chosen cause can donate through gift aid. To arrange this donors should look at their chosen charity’s website or contact them direct to discover the different Direct Debit sign-up options available.
For more information about Bacs and our services visit Bacs key facts.
Contact Bacs press office.
Notes
(1) The national figure is calculated as follows: 84% of the population donated money to charity (TNS findings) and on average £158.36 was donated per person from February 2004 – February 2005. British adults aged 16+ = c.46.5M) at the time of the survey being undertaken (population figures sourced from National Statistics Online 2003). The number of people donating to charity over the last year equals 84 per cent of 46.5M = 39,060,000. Therefore the amount of money donated to charity can be calculated as follows: 39,060,000 x £158.36 = £6,185,541,600
(2) July 2002 to July 2003. TNS research commissioned by BACS between 2 – 6 July 2003 showed GB donated an average of £3.2 billion a year
(3) This has been calculated as follows: 43.3% of adults in the GB adult representative survey claimed to be working full or part time (tax payers eligible for gift aid) and donated money to charity between February 2004 and February 2005, so 43.3% of 46.5M = 20.1million. According to the research study, British workers last year donated, on average, £74 without using gift aid. Therefore to work out the extra money that could be donated the following calculations should be applied: £74 x 20.1 M = £1.487 billion. Multiply £1.487 billion by the basic rate of tax (22%) and then divide by 78 to achieve the gross figure of donation = £419.5 M.
National league table of causes that people most cited giving to according to Bacs research in the past 18 months.
The giving of the nation: regional breakdown
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