Template Letters for Gift Aid at the end of tax year (Retail Gift Aid)
As outlined in HMRC’s Chapter 3 Gift Aid guidance, ‘End of tax year letters’ are compulsory for charities operating the Retail Gift Aid process using method A and method B. In both cases the individual must always be sent a summary of the net proceeds raised from the sale of their goods for the tax year by 31 May each year. However, if the donor’s total donations in a given year are less than £20, a letter only needs to be issued once every three years.
As this process was introduced in 2019, the first three years will be ending shortly and letters will be required. Following discussions with the Charity Tax Group and Charity Retail Association, HMRC has been working on the wording for template end of year letters to deal with the de minimis reporting requirements. We expect these updated letters to be posted on the HMRC website shortly, but have shared them now given the 31 May deadline is approaching.