We've been reading with much interest, ResPublica’s recent proposals for the modernisation of Gift Aid through electronic and online systems. 

“Modernising Gift Aid; Taking Civil Society into the Digital Age” looks at various ways that the Gift Aid process – from administration to claim – can be brought kicking and screaming into modern times. 

Today, IT is playing hugely important roles within many areas of our life’s, be it, social communication through Facebook or commercial benefits from using email or Smartphone’s.  However, the Gift Aid system (and in turn how people donate) has until now, largely been overlooked.  

ResPublica appears to have given serious thought about how to adapt the clear benefits of “cloud computing” and the increasing use of Smartphone’s to bring not only cost benefits but potential new rewards to charities.

Claiming Gift Aid Online 

Under its proposal, the main priority and the first step would be to allow gift aid to be claimed online rather than the current slow and costly paper trail method (which currently costs HMRC £5 to process every claim). 

The savings and benefits in terms of convenience and bureaucracy are numerous and the argument is compelling.  Any reform will be incomplete without this change. 

Although I agree wholeheartedly with their argument we should however, bear in mind that HMRC have been at the centre of some high profile gaffs with their current online filing systems used for tax returns and administration and have suffered from major critical outages through to users accessing other user’s information.  However, the current migration of online vat filing has, in the most, gone well.

End to Paper Declarations

The proposal considers how to abolish the paper declaration for gift aid and how this system can be migrated to an online verification system. 

The process, which could still involve a paper document but is amended to include an email address, would involve charities entering the information from the form into the software.  With the inclusion of the new address field an email is sent automatically to the user giving them chance to review the information, much like the current process when a user shops online for certain products or services. 

Once confirmed, a further email is sent to the user to confirm the gift aid declaration and been accepted and this is kept within the software system as proof.  The original paper document is destroyed at this point. 

Although the system is simple and would reduce the administrative burden for charities it still does involve a paper form to make the initial declaration and the charity wasting time entering the information again.  However, this may in some circumstances be unavoidable but a simple online form asking for the relevant information would surely suffice and fully automate the whole process for the donor.

Text Donations 

Currently, gift aid is claimed on less than 5% of all text donations.  If gift aid was claimed on 60% of these donations, this would generate annual sum of some £1m for charities. 

ResPublica proposes to team up with Ireni Mobile whom would manage the service in which users would be able to include “gift aid” or “ga” within their text donation to grant their consent.  Once the text is received, the software would create a declaration based upon the users mobile number used. 

There are now very few areas of our lives that are not affected by technology as we constantly strive to make our lives better connected and easier.  Allowing charities the same tools to help reduce their administrative burdens will be something HMRC will find difficult to resist soon.