Applying for a Home Mission Grant
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Changes to CRB disclosure process August 2012
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Church Finances
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First Aid Update October 2009
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Five Year (Quinquennial) Inspections
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Health and Safety Posters
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How to get CRB forms
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Important Information about metal theft
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Landfill Communities Fund
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Making sense of your Trust Status
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Meeting and interviewing prospective ministers
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New Pensions Note for 2012
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Notes from the 2012 Treasurers Day
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Planning your induction service
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Preparing for a pastoral vacancy
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Support of Individual Christian Workers
Support of Individual Christian Workers
The Office received a query about giving money directly to a church member who was undertaking a mission trip. The following advice from BUGB’s Honorary Taxation Advisor, which was published in Transform Magazine, may be useful to other churches in similar situations:
Q : Is it in order for our church to make payments direct to an individual in support of her work as a missionary overseas and can gift aid relief be claimed on donations received from church members for this purpose? Is it also in order for us to make payments to an individual engaged in freelance Christian service in the UK?
A : Making gifts to individuals can give rise to problems both from the point of view of charity law and gift aid relief. The trustees (deacons) of a church, like any other charity, have a duty to ensure that funds and resources are applied only in furtherance of its declared charitable objectives.
Where payments are made to an individual, rather than to a registered charity, it might not be possible to demonstrate to the satisfaction of the Revenue that funds have actually been applied for bona fide charitable purposes with the result that they would then be entitled to recover any gift aid relief or to assess to tax some part of the church’s otherwise tax-exempt income.
Furthermore, the trustees could be held to be in breach of trust.
The making of payments directly to an individual might also bring into question whether he or she is an employee of the church with consequent PAYE, national insurance and other employment law consequences. It follows that the wisest cause, wherever possible, is to channel gifts in support of missionaries and others engaged in Christian service through a sponsoring society. If this is not possible an alternative might be to use the facilities available through organisations like Stewardship UK who, provided the specified charitable and administrative conditions are met , can make arrangements to receive donations, claim gift aid relief and pass on funds to nominated individuals.
It should always be borne in mind that the Revenue insist that gift aid relief applies only to unfettered gifts to a charity for its charitable purposes. Donors, whilst perhaps expressing a wish, cannot direct a church’s trustees to apply gifts in a particular manner and once a donation has been received it is for the trustees to show that the income has been applied for charitable purposes only. Failure to do so will result in the recovery of gift aid relief and it is perhaps worth bearing in mind that matters could come to light as a result of a gift aid or PAYE inspection, the examination of a church’s accounts or by way of follow up from an enquiry made by a recipient.