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Payroll Giving FAQs for employers

 

 

What is Payroll Giving?

Payroll Giving is an easy and tax efficient way to allow your employees to donate to charity through their salary.

Why should Payroll Giving be offered to employees?

Payroll Giving highlights your corporate social responsibility by enabling employees to give to the charity of their choice.

How does Payroll Giving work? 

An employee will ask your payroll department to deduct regular charitable donations, they ensure this is done before tax.  Your employee will get tax relief straight away.  As an employer, you then pay this money over to an HMRC approved Payroll Giving agency and then will ensure it is passed onto the employee's chosen charity.

What records will we as an employer need to keep?

You are required to keep your contract with your chosen Payroll Giving Agency, the forms completed by employees that authorise you to take the deductions from their salary, a record of each deduction taken and receipt from the Payroll Giving Agency.

Is there any cost to us as an employer?

Payroll Giving agencies incur the majority of the cost for Payroll Giving.  They charge no more than 4% of the donation or 25p for each payroll deduction.  This is done before distributing the income to charity.  The administration cost to you as an employer should be very small and absorbed in your existing payroll costs.

Can employers pay the agency charge?

Yes – and many employers do so the full donation of their employee goes straight to their chosen charity.  This payment is allowed as a deduction against profits.

Who can join in the company Payroll Giving scheme?

Any employee or pensioner who is paid using Pay As You Earn (PAYE) tax can join the scheme.

Can employers match employee donations?

Yes, and this is a great way to show support to your employees and corporate social responsibility.  Any donation made as an employer will be allowed as a deduction against profits.

Can employers use Payroll Giving to support charity of the year schemes?

Yes, but your employees are free to give to any charity they choose.

As an employer, do I need to know all of the charities our employees donate to?

No, and your employees may wish to keep their charity choices confidential.  They can also keep their name confidential from the charity as well if they choose.

Will employees get unwanted mailing and telephone calls from charities?

All Professional Fundraising Organisation forms now require donors to opt into each form of communication.  We do like to thank supporters, and as orca adopters through WDC, they will receive their adoption pack and the quarterly magazine as we like to keep our donors up to date on how their support is helping whales and dolphins.

How do I set up a Payroll Giving scheme for my company?

You will need to select a Professional Fundraising Organisation and a Payroll Giving Agency from approved partners http://www.apgo.org.uk/members/

How can employers get the most out of Payroll Giving schemes?

The best thing to do is promote this effectively to your staff.  Your Professional Fundraising Organisation can advise on this or please contact payrollgiving@whales.org for other ideas.  Some employers offer incentives such as promoting the payment of the admin fee, matching donations, giveaways or prizes.