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We received over one hundred responses, including from charities, businesses, Payroll Giving Agencies, Professional Fundraising Agencies, individuals and various representative bodies. This document summarises the responses received and lays out our plans to respond.
Payroll Giving was introduced in 1987 to make tax-effective charitable giving simpler and more attractive to a wider range of potential donors. At the time, the main method of tax-effective charitable giving was through a deed of covenant, committing an individual to make donations for at least three years.
Payroll Giving allows an individual to make a tax-free donation to charity direct from their pay or pension, it is currently worth around £120 million a year to charities, however, only 2 per cent of employers offer this scheme with around 3 per cent of employees making regular donations.
The government is committed to raising levels of Payroll Giving. The system has provided substantial amounts to charities, but it has not worked as well as it could. So we are looking at how the system could be reformed, both to increase take-up and make it a social norm to give through the scheme.
We would like to hear from charities including Payroll Giving Agencies and other organisations with an interest in Payroll Giving, such as Private Fundraising organisations, as well as donors, employers and payroll service providers.