tax relief on charity donations

[eFestivals]

The rich people who give massive amounts to charity like to claim that they don't do it for the tax benefits they get from it, and yet when it's threatened to be capped or removed both the rich and the charities are saying that less will be given to charities - which rather proves the point that they do it to avoid paying tax.

Yes, I know that they have to give more to the charity than they'd pay in taxes, but the 'more' must be coming from somewhere. My suspicion is that in most cases involving the 'large donors' that negate their tax bill entirely, that 'more' is coming from money they've managed to somehow avoid tax on anyway, because it would take giving away all of your year's income plus some extra to turn your tax bill into nothing.

And then there's the abuse of 'charity' giving. For example, I'm sure the likes of Eton School (a charity. Why?) looks fondly on accepting the child of a donor into their school, in a way that wouldn't happen for others.

And I'm sure that most of us, if we had the choice, would rather give money direct to whatever our own 'pet' charities are than pay the taxes.

But in a democracy, we all have the chance to vote, and off the back of that we're meant to accept the consequences of that vote. And for just about all of us, that means we end up paying towards things the govt do that we'd rather not see our money spent on.

Should being rich enable someone to opt out of paying directly towards the up-keep of the country?

Perhaps the answer is for no charity donations to be claimable back via a tax return, with the tax-free status of charities maintained only via the 'gift-aid' claim-back system that is used when the likes of me gives money to charity.

[eFestivals]

It isn't really just something open to the rich... Its open to anyone doing a tax return...

care to tell me how many of 'the poor' do tax returns rather than PAYE?

And by putting it on a tax return, the ability is there to get the tax relief twice over because of the gift aid - at the expense of other tax payers.

And half the supposed 'charities' aren't charities anyway. I know of a 'charity' that runs a festival where the aim of that 'charity' is to buy a farm, where the people who run the festival will get to live in the environment they want at the expense of things like legal aid for abused women, help for disabled people, and free healthcare on the NHS.

The whole thing is rotten from top to bottom, and manipulated to no less of an extent than people manipulate things to pay the minimal tax.

[kaosmark2]

I think you've got the key thing with Eton being a charity. Supposedly Osborne's reasoning for introducing this is that lots of charities aren't charitable causes - well considering the government (via the charity commission) decides what is and isn't a charity, surely they could impact on that?

There are circumstances though, where rich people run their own charity, donate their money directly to it, evading the tax on it, then claiming expenses off the charity they run for all sorts of things... Stopping crap like that ought to happen.

[eFestivals]

I think you've got the key thing with Eton being a charity. Supposedly Osborne's reasoning for introducing this is that lots of charities aren't charitable causes - well considering the government (via the charity commission) decides what is and isn't a charity, surely they could impact on that?

There are circumstances though, where rich people run their own charity, donate their money directly to it, evading the tax on it, then claiming expenses off the charity they run for all sorts of things... Stopping crap like that ought to happen.

A part of the problem are the charity rules, I agree - but I'll be gobsmacked if the likes of Eton and just about all the other fee paying schools are cracked down on.

Things like that are the standard long-seen-as-a-right tax avoidance by the mega rich, where they can get the taxpayer pick up much of the tab for their self-given privileges, and it's an idea being expanded with 'free schools' which I'm completely confident is something that's planned to be expanded and widened in the future so that the likes of Eton will become a 'free school' so that the taxpayer will pick up some more of the tab.

Then again, Osborne might just do that out of jealousy, spite and bitterness, cos he's apparently never got over being called 'oik' by the Eton old boys like Boris and Dave Moron.

[kaosmark2]

A part of the problem are the charity rules, I agree - but I'll be gobsmacked if the likes of Eton and just about all the other fee paying schools are cracked down on.

Things like that are the standard long-seen-as-a-right tax avoidance by the mega rich, where they can get the taxpayer pick up much of the tab for their self-given privileges, and it's an idea being expanded with 'free schools' which I'm completely confident is something that's planned to be expanded and widened in the future so that the likes of Eton will become a 'free school' so that the taxpayer will pick up some more of the tab.

Then again, Osborne might just do that out of jealousy, spite and bitterness, cos he's apparently never got over being called 'oik' by the Eton old boys like Boris and Dave Moron.

[grumpyhack]

I'm happy with the Gift Aid system

[eFestivals]

So is your problem with the NSPCC getting tax relief twice or some obvious scam with Eton getting it twice...

The two aren't really one and the same are they...

No, my problem is people avoiding paying towards the society they live in, and instead choosing to give that money to their 'pet' causes which aren't necessarily things which society as a whole should and would pay towards.

The issues of what should be regarded as a charity and what should be disallowed is something aside from that, those it's a part of what's mixed in with the initial problem of the richest being able to opt out of paying towards society via their taxes.

Perhaps the best answer would be for there to be no tax relief for charities at all. After all, there's little in the way of democratic accountability for those who benefit, despite them benefiting via taxpayers money. There'd of course be problems caused by that to 'genuine' charities when it's implemented, but it would be temporary and it would remove a whole aspect of rip-off from society.

[Gre]

care to tell me how many of 'the poor' do tax returns rather than PAYE?

Edited April 19, 2012 by Gre

[eFestivals]

I see this whole thing as concerning only the papers (need to fill the paper with some none event etc) and a few people who like to get worked up about pretty much everything.

If some millionaire wants to give away a small fortune to some charity then by and large I think thats a positive thing and I have no problem with the tax system etc recognising it. I doubt many do. Yeah can pick some instances which could possibly be abuse like Eton etc... But there is no doubt a bigger picture.

It's much much worse than I'd been thinking, and much much worse than you're believing.

Some stuff I've read since yesterday gets to reveal that many of these "charities" that the mega rich are funnelling their money into are not anything like you and I would understand as charities, and these 'charities' are benefiting the mega-rich directly and not helping anyone else.

Many are "family trusts" or "charitable foundations", where the money is put away tax free to benefit that person's family into the future - essentially it's the tax payer funding the mega-rich to ensure that the mega-rich stay mega-rich.

And then there's things like Llloyd Webber's Art Foundation, which buys hugely expensive works of art tax free, which is then 'rented' for peanuts to .... Lloyd Webber.

Fuck putting a limit on the amount they can claim back for tax, abolish the whole tax relief for charities. This is a massive pisstake at the expense of the poor, the same poor that would need far less 'charity' to support them if these rich fuckers didn't take the piss. :angry:

[eFestivals]

or just get tougher on what is and is not a charity...

Care to suggest how it can be done in a workable manner?

A line would have to be drawn somewhere, and people (who?) judge which side of the line any cause was. It would be far from perfect for many genuine causes.

And then of course we'd have abuse of the charities system no different to the abuse of the tax system, via manipulation of the rules and the use of loopholes - after all, if it's worth doing for tax avoidance in general (which it is) it'll be worth doing for something else that is hugely used for tax avoidance.

So at best we'd be replacing one set of problems with another, and neither of them can be worked perfectly, and neither of them would ever have their problems go away.

If tax relief on charity giving was abolished then they'd be initial problems during a period of adjustment by those charities, but after that adjustment the problems around this issue go away. And they'd be no loss to society via the diversion of what-was-previously-going-to-charities money towards tax revenue, as that extra money would then be available to spend on helpful services to the public - and in a much better democratic manner too.

[kaosmark2]

I think as a society we are quite comfortable with people in generals giving to their "pet" causes like the NSPCC, NSPCA, Cancer Research etc...

[kaosmark2]

a much better democratic manner too.

[eFestivals]

Nope... Happy with current system...

would that be because you can make yourself look to be more generous than you're being in reality?

I am willing to bet the current system is doing more good than harm...

If we go on the basis that the removal of tax relief would divert that money in tax coffers, and that money for the benefit of the public was then able to be applied towards the public in a more democratic manner than is done via private donations to charities (and I can't see how you can argue against this part), then it becomes the case that the current system is more damaging to society than if that money went into the tax coffers.

If you disagree with that I'd love to know your reasons for why.

[eFestivals]

Arguably the public choosing which charities they want to donate money towards is as democratic as you can get. People choose what they want to support financially directly, and the overall balance between charities will be determined to reflect public opinion.

No one would be stopping people from still giving to charities as they wish. The difference would be that everyone would be contributing to the tax coffers as is expected of citizens.

People wouldn't be able to divert their contribution towards society (where it gets democratically managed [in theory at least]) towards their 'pet' causes which might not have the democratic support to justify that diversion of money.

The balance between charities is determined only by those with the spare money to donate and who wish to donate. It excludes those who do not have the spare money, or who do wish to support charities as they believe that the help that charities give should be delivered by a different means.

Edited April 19, 2012 by eFestivals

[kaosmark2]

No one would be stopping people from still giving to charities as they wish. The difference would be that everyone would be contributing to the tax coffers as is expected of citizens.

People wouldn't be able to divert their contribution towards society (where it gets democratically managed [in theory at least]) towards their 'pet' causes which might not have the democratic support to justify that diversion of money.

The balance between charities is determined only by those with the spare money to donate and who wish to donate. It excludes those who do not have the spare money, or who do wish to support charities as they believe that the help that charities give should be delivered by a different means.

[kaosmark2]

As a thank you ? A lot of rich people are supporting some VERY worthy causes...

[kaosmark2]

Look at the governments budget and get real... All those are being supported... Its not an either or situation...

I wouldn't argue against greater scrutiny about what is and is not a valid charity...

[eFestivals]

Your failure in logic is by democratic process we have very much stated we want this (current) system...

The general idea of charities being tax free is something which has existed since before this country was democratic, so it's not something that has been implemented via democracy but only sustained by democracy.

And now it's being exposed for the abuse that it's enabling, the number of people that want it to remain has changed dramatically. Once all the facts are in the open then it might well be the case that it's not wanted.

Isn't it strange how you hugely object to people who have paid into the tax system getting benefits at the level necessary to support them in their time of need, but you have little issue with others not paying into the tax system at all as long as they're filthy rich.

Gift Aid and tax savings on giving is very popular...

Don't mix Gift Aid in with personal tax avoidance. They're two very different things.

The giver gains no direct personal benefit via Gift Aid, while they do with charity giving that is set against tax on a tax return.

It's hardly surprising that both are popular. But the second is far less popular after this exposure of abuse, and with those who aren't able to be in on the scam.

[eFestivals]

I said earlier on.... No one gives a fuck besides a few people who piss and moan about everything...

You might be right.

But all that gets to show is how vacuous the heads are of the people who don't give a fuck. Well, vacuous, or greedy and in on the scam.

[kaosmark2]

And no doubt giving to charity is seeing some hits as well... I don't see the link...

Cancer research, elderly charities, rape victim charities etc etc etc... All worthy things all needing money and hardly come on the governments radar...

Your whole thinking is a mess... We have an issue with people declaring charities which aren't charities so lets fuck about with the tax system some more than sorting it out properly ?

Thank fuck your not running for government...

[eFestivals]

Cancer research, elderly charities, rape victim charities etc etc etc... All worthy things all needing money and hardly come on the governments radar...

if they're worthy and not funded they'd very soon come onto the govt's radar.

A part of the problem for why the properly worthy causes are not on the govt's radar is because there's the charities to pick those issues up instead of the govt. It's a self sustaining scenario.

Surely if something is properly worthy, you're able to see that they'd be the democratic will to pick up the funding for that worthy thing thru the tax coffers - particularly when those tax coffers will have suddenly increased by the same amount that the charities (but all of them, not just the properly worthy ones) had been shorted.

The likes of you would be able to have a tax cut (because they'd be more coming in to the govt than would need to go out - the difference between ' properly worthy' and not), and all of the properly worthy causes would be no worse off.

What's there for you to hate about that?

[abdoujaparov]

Many are "family trusts" or "charitable foundations", where the money is put away tax free to benefit that person's family into the future

[eFestivals]

as a matter of fact, a family trust, or any trust set up to benefit an individual or a family, cannot by definition be charitable

Then I guess it qualifies for the same tax benefits, and that's why it's being mixed in on the reports I've read (which include within this weeks private eye)

Or perhaps the person who's advised you of that isn't in on the scams others are using?

[abdoujaparov]

Or perhaps the person who's advised you of that isn't in on the scams others are using?

[kaosmark2]

There's ways to do the scams, but there was a crackdown on trusts and foundations related to families a few years ago.