A Guide to Tax Benefits for NABD Members & Donors

TAX BENEFITS FOR NABD MEMBERS & DONORS

If you are a UK taxpayer, your donations to the National Association for Bikers with a Disability (NABD)* can unlock valuable tax advantages, many of which people are unaware of. The way you claim these benefits depends on how you pay tax, and the value of the relief depends on your tax bracket.

This guide explains the options in clear, straightforward terms.

GIFT AID: A Simple Way to Increase Your Donation by 25%

Gift Aid is a UK government scheme allowing charities to reclaim 25p in addition to every £1 donated by a UK taxpayer, at no extra cost to the donor. Donors must make a Gift Aid Declaration, and they must have paid enough Income Tax or Capital Gains Tax to cover the amount reclaimed during that tax year.

A valid Gift Aid declaration must include:

• The charity name
• The donor’s full name and home address (including postcode)
• Details of the donation

If you live in the Channel Islands or the Isle of Man, you must state you are a “non-UK donor” and omit the postcode.

A Gift Aid declaration can apply to:

• A single donation
• All donations made in the previous four financial years
• All future donations

NB. Donors can cancel a declaration at any time.

NABD Membership & Gift Aid:

NABD membership subscriptions are classed as ‘Donations’ which means they qualify for Gift Aid.

An NABD Membership Gift Aid Declaration covers all donations made to the NABD (including those made over the four previous financial years, and all future donations).

NB. Not all membership subscriptions to charities are classed as donations. You should check with the specific charity for verification.

TAX RELIEF ON CHARITABLE DONATIONS:

To claim Tax Relief on your donations, you must have completed a Gift Aid declaration.

People on PAYE (Cards In):
People on PAYE can increase their tax-free allowance, which is the amount they can earn before incurring tax, by making charitable donations.

Donations made by Cash, Card or Bank Account: (Gift Aid)
If you donate via cash, debit card, credit card, direct debit, or bank transfer, the charity can claim Gift Aid because you have already paid tax on that income.

Making a Claim:
To claim your own tax relief, you can:

• Call or write to HMRC with details of your donations
• Submit a P87 form, which is especially useful for NHS staff and others who can also use it to claim for uniform‑washing and other work‑related expenses. https://assets.publishing.service.gov.uk/media/65c3605a3f634b000d42c5f3/P87_fillable_English_baselined.pdf
• These claims can include all donations made over the previous four financial years, if a Gift Aid declaration has been completed.

The HMRC may issue a refund or adjust your tax code, so you pay less tax for the year.

Payroll Giving (PAYE employees):

If your employer offers the ‘Payroll Giving’ scheme, you can get automatic tax relief on regular charitable donations by donating from your gross salary before income tax is calculated and deducted.  This gives you immediate tax relief without any forms or declarations.

Because you will not be taxed on the portion of your salary you donate:

• Basic rate (20%) taxpayers: £10.00 donation only costs you £8.00, a £50.00 donation only costs you £40.00, a £100.00 donation will cost you just £80.00
• Higher rate (40%) taxpayers: £10 donation only costs you £6, a £50.00 donation only costs you £30.00, and a £100.00 donation costs you just £60.00.
• Additional rate (45%) taxpayers: £10 donation only costs you £5.50, a £50.00 donation only costs you £27.50, and a £100.00 donation costs you just £55.00.

NB. Payroll Giving donations do not qualify for Gift Aid, but they do reduce the donor’s tax liability.

Self Employed People (Basic Rate Taxpayers):

If you are self-employed, and subject to basic rate (20%) income tax, your charitable donations qualify for Gift Aid, so as long as you have completed a Gift Aid declaration for the charity, the charity can claim an additional 25% from the HMRC on each donation.

As a self-employed individual, you have the ability to claim charitable contributions as a write-off on your taxes.

Making a Claim:
Enter your Gift Aid donations in the ‘Charitable Giving’ section of your self-assessment return.  This reduces your taxable income and may also reduce tax due on dividends or pensions.

NB. These claims can include all donations made over the previous four financial years, if a Gift Aid declaration has been completed.

Higher Rate or ‘Additional Rate’ Taxpayers:

If you are the 40% higher rate or the 45% additional rate tax, you can reclaim additional tax relief on top of the Gift Aid charity claims.

Gift Aid only accounts for basic‑rate tax (20%). If you pay 40% Tax or 45% Tax, you can reclaim the difference.

For example:

• You donate £100
• The charity claims £25 (Gift Aid)
• You can reclaim an additional £25 (40% rate) or £31.25 (45% rate)

Making a Claim:
Enter details of all your Gift-Aid charity donations in the ‘Charitable Giving’ section of the self-Assessment return.

If you don’t fill in a self-assessment form, you can contact HMRC directly to inform them of the donations, which should result in a tax code adjustment or a tax refund.

NB. Claims can include donations from the previous four financial years, if a Gift Aid Declaration has been completed.

Earning Over £100,000: Avoiding the “60% Tax Trap”

If you earn over £100,000, your personal earnings allowance reduces by £1.00 for every £2.00 you earn over £100,000. This is often referred to as “the 60% tax trap”.

Gift Aid donations can restore your tax-free allowance.

For every £1.00 of Gift Aid donation (grossed-up to £1.25 by Gift Aid) your adjusted net income is reduced, helping restore your personal allowance.

For Example:
If your income is £110,000, your personal allowance is reduced by £5,000.

• Donate £8,000 to the National Association for Bikers with a Disability* and make a Gift Aid declaration
• This donation is ‘grossed-up’ to £10,000
• Your adjusted net income is now £100.000
• Your full personal allowance is restored, removing you from the 60% tax trap

This can produce substantial tax savings while supporting a most worthy cause.

NB. Claims can include donations from the previous four financial years, if a Gift Aid Declaration has been completed.

Benefits Beyond Tax Relief:

In addition to the tax benefits of making a Gift Aid donation to The National Association for Bikers with a Disability, the physical and psychological benefits of such altruism should never be underestimated!

According to the National Institutes of Health (.gov):

Altruism, the selfless act of helping others, provides significant physical and psychological health benefits, including:

• lower blood pressure
• reduced stress
• boosted immune function
• increased longevity

It also triggers “a helper’s high”, due to the release of endorphins and dopamine, resulting in:

• increased happiness,
• increased confidence,
• a sense of purpose
• reducing anxiety.

Final Word:

I hope this article has given you a better understanding of the tax advantages of making donations to the NABD and indeed of becoming a member of the NABD.

Every donation received by the NABD is much needed and wisely used for the benefit of people with disabilities, many of whom find the renewed joy and freedom offered by independent motorcycling to be their escape route from a pit of despair.

Every donation to the NABD, large or small, can help to change lives for the better. To paraphrase what may have conceivably been a slogan in an Ancient Roman supermarket…  “Omnis exigua adjuvat” (Every little bit helps).

To find out more about the National Association for Bikers with a Disability, see: https://nabd.org.uk/

Rick Hulse
NABD Chairman

* These tax benefits also apply to donations made to other registered charities.