The Importance of Charitable Giving

The Importance of Charitable Giving
The Importance of Charitable GivingThe Importance of Charitable Giving

Many of us have a favourite charity. We may have chosen it for personal reasons, or because we identify with the charity’s aims and objectives.  Whatever the reason, many of us want to give something back to the communities in which we live, and to help promote a more caring society.

Employers too often share these aims and formally support them through a corporate social responsibility strategy which can boost their reputation as a responsible business and a good employer.

When we give, we often do so without consciously thinking about the uses our donation will be put towards - or the mechanism of giving. We simply want to support good causes and we give freely without a second thought.

The feel-good factor

Did you know that giving to charity helps promote a sense of wellbeing and fulfilment?  These feelings can be amplified by making a regular donation to charity, especially via payroll giving, an easy way for employees to support the causes important to them.

It also has obvious benefits to the charity sector, including providing them with a long-term and regular income stream. This allows them to plan and to invest in services to help the people they serve. We all know how important the work of charities is to our communities, society in general, and to each of us.

But there are additional benefits in payroll giving for making regular donations to charity.

1. Payroll Giving reduces the administrative costs for charities

Donations from net earnings (after Income Tax is paid), charities need to claim Gift Aid to get the tax back from HMRC. But with payroll giving, donations are made from gross pay (before tax) so charities no longer have to use precious resources doing this. This reduces their administrative costs, so they can focus more funds on the core and more valuable work.

2. Charities get more of every donation

Payroll giving means that donations are deducted directly from salary before tax. This means that the employee gets tax relief on their donation which is passed straight on to the charity.

3. Employers can offer a genuine employee benefit

Having a Payroll Giving Scheme is a great employee benefit because it allows employees to give to a charity of their choosing in the most tax-efficient and effective way. Some employers also choose a charity for the whole organisation to support each year which can promote employee engagement.

Doubling the numbers

PayCaptain offers employers and employees an additional benefit in the form of donation matching. PayCaptain’s payroll giving function allows employers to match employees’ donations each month - a great way of doubling the amount paid to charity and a benefit you can only get via payroll giving.  The facility can be used if employees are donating to a charity nominated for the whole organisation or to individually chosen ones.

If employees want to give to charity on a regular basis, payroll giving is one of the simplest ways to make donations to their favourite causes. And because it’s tax-effective, it’s great for charities too.

Imagine the impact on the charity sector, our communities and society if each and every one of us donated 1% of our earnings to charity and this was matched by our employer? Wouldn’t that be amazing?

PayCaptain Payroll Solutions is the software and payroll service and is the HMRC approved Payroll Giving Agency – together they enable a highly effective and simple method to operate a Payroll Giving Scheme in your company.