Gift Aid Scheme - how do you know where to take it?

Biscuit656 Registered Posts: 4
Good afternoon,

I am sitting my exam next week and I'm still struggling with the Gift Aid Scheme. I've noticed in some examples the Gift Aid Scheme is taken from Tax Payable whereas other times the basic tax rate band has been extended.

My question is this, how do I know which one it should be taken from? Is there a key phrase that I should be looking out for?

Kind regards,


  • reader
    reader MAAT, AAT Licensed Accountant Posts: 1,037
    It should be clear from the question.

    For example, if the cash donation (not grossed up) is deducted from an employee's salary it would be part of the give as your earn (GAYE) scheme. Therefore less income would be subject to income tax, and therefore less income tax due:

    If the tax payer if a higher rate tax payer and is making a personal gift aided charity donation then you need to extend their basic rate tax band in order to ensure that they save an additional 20% tax on top of the 20% tax uplift that their donation receives at source. In this case, the donation has to be grossed up by 100/80:
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