Archive Website of the UK government

Why you need to keep records

You need to keep records so that you can claim the right amount of tax relief on your gifts to charity. For example, you can get tax relief on gifts of land or shares to charity, or some Gift Aid donations.

You’ll also need a record of Gift Aid donations if you apply for certain income related benefits (such as tax credits) or if you get the age-related Personal Allowance, Married Couple’s Allowance or Blind Person’s Allowance.

Records of Gift Aid donations

You should keep records of Gift Aid donations each year showing the date, the amount and the charities or Community Amateur Sports Clubs (CASCs) involved.

If you’re a higher rate tax payer you’ll be able to claim back some tax based on the value of your Gift Aid donation.

If you get the age-related allowances or claim tax credits your entitlement may increase. This is because HM Revenue & Customs (HMRC) subtracts the amount you donate plus the basic rate tax from your total income. HMRC then uses this reduced income figure to work out the value of your allowances or tax credits entitlement.

In any of the above cases you may be asked to provide evidence of your donations.

• Tax allowances and reliefs

• Giving to charity through Gift Aid

• How to work out income on your tax credits claim

Records of gifts of land, buildings or shares

You can claim Income Tax relief equal to the net value (the value after all tax deductions have been made) of the land, buildings or shares you give to a charity, or sell to a charity at less than their market value.

You should keep records of these donations or sales so that you can claim the correct amount of tax relief.

You get the Income Tax relief for the tax year in which the gift or sale was made.

If you’re selling the land or shares on behalf of the charity

If the charity asks you to sell the land or shares on their behalf you can still claim this relief, as long as you keep proper records of the gift and the charity’s request.

For example, keep any correspondence in which the charity accepts your gift but asks you to sell the asset on their behalf and pass the proceeds to them.

Keep transfer documents and paperwork showing payment of the proceeds of the sale to the charity.

For details on how to claim tax relief, see the section below on ‘Telling HMRC about your gifts to charity’.

If you have already made a gift of land or buildings you can ask for confirmation of the value at the date of transfer from the Valuation Office Agency.

• Tax relief when giving assets to charity

• The Valuation Office Agency Opens new window

Records of goods sold by a charity on your behalf

If a charity sells goods on your behalf and you donate the sale proceeds to them, you can make the donation using Gift Aid.

The charity will usually write to you to tell you the sale proceeds of your goods.

For example, a charity shop must contact you after selling goods, to give you the option of keeping all the proceeds. You should keep this paperwork.

You might have to pay Capital Gains Tax if you make a profit from the sale. Capital Gains Tax is a tax on the gain or profit you make when you sell or give away something that you own, such as property. You’ll need to keep records so that you can declare the capital gain.

If you give the goods directly to a charity instead of asking the charity to sell them on your behalf, you will not have to pay Capital Gains Tax. However, you will not be able to Gift Aid the proceeds from the sale of the goods.

• Introduction to Capital Gains Tax

Records of gifts made through Payroll Giving

You don’t need to put details of gifts made through Payroll Giving on your Self Assessment tax return or tax credits application.

This is because the figure of taxable earnings/pension (from your form P60), which is used to work out your tax or tax credits, won’t include the income used to make these payments.

You should, however, keep records for your own reference.

• Giving to charity through your payslip or pension

Telling HMRC about your gifts to charity

If you normally complete a Self Assessment tax return, tell HMRC about your gifts to charity - and claim any tax relief - by completing the appropriate section on your tax return.

If you don’t complete a tax return, you can give the details on form P810 Tax Review - available from your Tax Office.

If you pay tax through PAYE (Pay As You Earn) contact your Tax Office and ask them to make a change to your tax code.

• Self Assessment: the basics

• Completing your tax return (individuals and directors)

• What to do if your tax code is wrong

• Find your Tax Office Opens new window

How long to keep records

If you're not running a business, you'll normally have to keep your tax records for at least 22 months from the end of the tax year to which they relate.

For example, if you gave a property to a charity in September 2008, you must keep any records relating to it until at least 31 January 2011.

If you’re in business (as a sole trader or partnership) you must keep your tax records for at least five years and one month after the end of the tax year to which they relate.

For example, if you made a Gift Aid donation in October 2008 you must keep your records until at least 30 April 2014.

If HMRC makes any enquiries about your tax return you will need to keep your tax records until the enquiries are completed.

• Record keeping (individuals and directors)

• Find out how long companies need to keep tax records for Opens new window

Contacting the HMRC Charities Helpline

For more help you can contact the Charities Helpline.

• Contact the Charities Helpline Opens new window

Useful contacts

• Money, tax and benefits contacts