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Government consults on Payroll Giving reform

The Government has launched a consultation on proposals to reform Payroll Giving, in a bid to improve the scheme and increase the number of charitable donations.

Under Payroll Giving, UK taxpayers can make regular tax-free donations to charities, via their pay or pension. The donations are deducted from gross pay, costing a basic rate taxpayer 80p for each £1 that is donated.

Currently only 2% of employers offer the scheme, with only 3% of employees making regular donations.

The Government is proposing to introduce a number of changes to the system with the aim of making it easier for donors to enrol in the scheme, and helping charities to receive donations more quickly.

Economic Secretary to the Treasury, Sajid Javid, said, ‘Payroll Giving is a powerful and flexible way for people to support the causes they care about. The proposals that the Government is publishing today are an important step in raising awareness and making this scheme work better for donors and charities alike’.