In June 2022, CTG representatives met members of HMRC’s Charities Policy Team to share concerns about issues for charities claiming Gift Aid via third-party fundraising platforms. This was particularly in relation to the liability for any incorrect claims and to test claims by platforms that their processes had been formally approved by HMRC.

HMRC officials have now provided a response to two questions:

1) Does a charity’s Gift Aid audit trail need to be traceable back to the bank records showing the individual’s initial donation? 

HMRC response: Where a charity receives a single BACS payment alongside a breakdown of who has donated and how much they have donated this will be sufficient for HMRC’s audit purposes. The charity will not be required to show an audit trail back to the bank records showing the donation being received into the third party’s bank account. There are a couple of caveats to this; firstly the usual remaining Gift Aid rules must be met and secondly the amount transferred from the third party must tie with the breakdown of donated amounts provided.

2) Will HMRC undertake audits of third party fundraising platforms and make public the outcome? 

HMRC response: HMRC does not feel that it is able to audit a third party fundraising platform and then provide a public view on whether the Gift Aid audit requirements are met, I understand that this will be of disappointment to you. Whilst HMRC is unable to provide a public view on a third party fundraiser, third party fundraisers are regulated on a voluntary basis by the Fundraising Regulator. If you or another charity have any concerns regard the actions of a third party platform these can be self-reported to the Fundraising Regulator. Incidents can be reported at Self-reporting incidents | Fundraising Regulator. The Fundraising Regulator’s Code of Fundraising Practice, has a section relating to fundraising through third parties, which a charity using a third party platform should review and ensure they adhere too. The Code of Fundraising Practice can be found at Professional fundraisers, commercial participators and partners | Fundraising Regulator and the relevant part is at section seven.