Helping to fund the causes that are close to your heart is one of the positive side effects of running a successful business. But you also need to keep track of what you’re donating, keep HM Revenue & Customs (HMRC) informed and make sure you’re ticking the compliance boxes.
Here’s a quick summary of the rules for companies making charitable donations.
There are a few restrictions you need to be aware of regarding the tax-deductibility of donations to charities and community amateur sports clubs.
How can my accountant help me with this?
Under normal circumstances, the cost of donations to charities and community amateur sports clubs can be deducted for corporation tax purposes.
The way in which the cost is reflected in the company’s tax return will differ, depending on the form of the donation being made. The total claimed can be restricted if it results in a trading loss, or increases an existing trading loss.
Care must be taken to ensure the correct VAT treatment of items donated.
Talk to us about making a charitable donation
We can advise on the correct accounting and tax treatment for your charitable donations. We’ll make sure the tax treatment is right and everything is properly reflected in the company records.
Call us to talk about any areas of charitable giving that you’re unclear on.
Unit 157, Milton Keynes Business Centre,
Foxhunter Drive, Milton Keynes,
Buckinghamshire, MK14 6GD
Bidwell Accountancy