Company tax deductions for charitable donations

There are special rules in place when a limited company gives to a charity. This can include Corporation Tax relief for qualifying donations made to registered charities or community amateur sports clubs (CASC), as well as Capital Allowances for giving away equipment that has been used by a company.

However, the rules are different if the company is given something in return for making a donation, such as tickets for an event.

Donation Amount      Maximum Value of benefit that is
     acceptable   
Up to £100      25% of the donation
£101 – £1000      £25
£1,001 and over      5% of the donation (up to a maximum of £2,500)

 

These rules apply to benefits given to any person or company connected with your company, including close relatives.

Charity sponsorship payments are different from donations because the company gets something related to the business in return. A company can deduct sponsorship payments from its business profits before it pays tax by treating them as business expenses.

Payments qualify as business expenses if the charity:

•publicly supports the company’s goods or services

•has links from their website to the company’s

•permits them to sell their goods or services at the charity’s events or premises

•allows the company to use their logo in company’s printed material.

Posted by Cassey Nixon on

1st March 2019

Categories

  • Income excluded from property business

    HMRC publishes a list of income streams that are excluded from a UK property businesses’ taxable income. The list includes fishing concerns, hotels and guest houses, tied premises, caravan sites, lodgers and tenants in your own home, extra services to tenants and letting surplus trade accommodation. In most cases the income from these activities will […]

    Andrea L Richards | Accounts Navigator Associates Ltd
  • When National Insurance Credits can be claimed

    National Insurance credits can help qualifying applicants to fill gaps in their National Insurance record. This can assist taxpayers to build up the amount of qualifying years of National Insurance contributions and thus increase the amount of benefits a person is entitled to receive, for example, the State Pension. National Insurance credits are available in […]

    Andrea L Richards | Accounts Navigator Associates Ltd