In addition to one-off or regular gifts, there are other ways that you can donate to the Annual Fund and utilise significant tax concessions or other advantages.
Giving shares and securities is highly tax efficient for the donor who can achieve large tax savings, not only on capital gains tax but on income tax as well. All donations of shares to a registered charity now receive income tax relief of 100% of their market value. This means that if you give shares to the Annual Fund you will receive income tax relief on this in full. (eg: On a gift of shares worth £10,000, the tax relief is £4,000 at the higher rate of tax. This relief can apply whether it is an individual or a company disposing of the shares.)
The donor can also deduct the market value of the shares or securities on the date of disposal plus any incidental costs of disposing of the shares (broker's fee etc) less any consideration given in return for disposing of the shares and the value of any other benefits received by the donor, or a person connected with the donor, in consequence of disposing of the shares. Donors can claim the tax relief, at their top rate of tax on their Self-Assessment or Corporation Tax return.
The only requirements to make such savings are that donors must:
- Claim the tax relief themselves in their tax return.
- Give the shares intact to the Mill Hill School Foundation (i.e. Not sell them first).
- Give listed shares or securities, units in authorised unit trusts, shares in open-ended investment companies, holdings in foreign collective investment schemes or unlisted shares or securities dealt on a recognised stock exchange such as AIM.
In addition to income tax saving, donors making gifts of shares to the Annual Fund will not attract any capital gains liability. If a tax payer makes a gift with £10,000 worth of capital gains (after indexation, taper relief and the annual exemption amount) to charity, there will be no capital gains tax on this gift, a potential saving of £4,000. Together, these mean that a tax-payer making a gift of £200,000 (with a capital appreciation of £100,000) could pay as much as £120,000 less in tax compared with a non-charitable disposal.
A number of companies are willing to match the donations their employees make to charities. Ask your HR Department whether they sponsor this scheme and thereby increase your gift at no expense to yourself. If they run such a scheme, we are happy to work with your employer to activate the necessary paperwork.
A number of employers also offer payroll giving which means that you can give to the Annual Fund and get immediate tax relief at your highest rate of tax. The agreed donation is deducted from your pay (or pension) before PAYE is calculated so you get tax relief straight away at your highest rate of tax. Again, please ask your employer about this option and contact us if you need any help or advice.
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A charitable remainder trust is a life income gift in which you make an irrevocable contribution of cash, securities, real estate, or other assets to a trust that ultimately benefits the Mill Hill School Foundation . You receive income from the trust for a period of time such as your life or the life of another, and the Foundation receives the remaining trust principal at the end of the term, to be used for the purpose you designate.
There are two types of charitable remainder trusts-the charitable remainder unitrust and the charitable remainder annuity trust.
With the unitrust, the beneficiary or beneficiaries receive a fixed percentage of the annual value of the trust principal. Payments may fluctuate from year to year, since they are based on the changing annual value of the trust. The donor can make additional contributions to a charitable remainder unitrust.
With an annuity trust, the beneficiary or beneficiaries receive a fixed dollar amount annually. Payments will not fluctuate from year to year. Additional trust contributions are not allowed with a charitable remainder annuity trust.
Some benefits of establishing a charitable remainder trust are:
* income to the beneficiary or beneficiaries for life or term of years
* current income tax deduction
* deferral of capital gains tax on appreciated assets
* possible reduction of estate taxes
In addition to these benefits, a charitable remainder trust can provide generous support for the future of the Mill Hill School Foundation.
Almost any bank will set up a CRT.
The trust beneficiary should be British Schools and Universities Foundation Inc (BSUF), with preference to Mill Hill.
Anyone considering this should talk to their lawyer and the Development Office at the Mill Hill School Foundation, who will inform BSUF. For Further information, please contact Nick Priestnall.