Employee information for lump sum donations through payroll
You can make donations to a nominated charity directly from your salary.
If the accumulated amount over the year is £50 or more, the donation will qualify as a lump sum donation.
It is an easier way to give, as your employer will administer the scheme and you can spread your charitable giving over a year.
- you join an employer who have a lump sum donation payroll scheme, so you set up a £10 per month donation direct from your salary from January to December
- the employer sends your donation to the nominated charity in December
- as the donation is over £50 it qualifies as a lump sum donation
- the charity will receive your £120 plus an additional £30 from the Taxes Office
Your payroll will still provide your gross income (the amount before the charity deduction) to the Taxes Office and this is also the amount you must declare on your annual tax return.
You should also enter the details of the donation, along with any other qualifying donations to Jersey charities, on your personal tax return.
Employers information for lump sum donations through payroll
When you set up a lump sum donation payroll scheme you must ensure that the nominated charity is established in Jersey and exempt from income tax. The charity will be able to provide a letter from the Jersey Taxes Office confirming they 'are exempt under Article 115(a)' as proof of this.
When the total collected is given to the charity you must include a schedule with the following information for each employee who has donated:
- tax reference
- amount donated for the year
You are responsible for the administration of the scheme, including keeping records of the donations for 6 years.
If you are below the tax threshold, exempt from income tax or a zero rated company you should not use these schemes, but just pay the charity the amount you want it to receive.
If you do make a payment using the above schemes you will have to pay income tax of the amount that the charity receives from the taxes office.
A 10% company would need to pay half of the amount the charity claims back.