‘A time for giving’ – what to think about when making a charitable donation at Christmas

Published: Posted on

By Professor Paul Montgomery, Professor of Social Intervention and Doctoral Researcher, Caroline Greenhalgh
School of Social Policy, University of Birmingham

At this time of year, many of us will be thinking about giving money to Charity. In fact, donations peak in December and last year 37% of households made donations to charities in the last month of the year.  But with over 167,000 charities in England and Wales[1] alone, it can be hard to decide who to support.  Many people choose to donate to charities supported by their friends or other influencers, but remembering the case of Kids Company should remind you to think for yourself.

Researchers at the Third Sector Research Centre have identified a few key points to remember before you press ‘donate’ on your computer.

  1. Who to support?
    If charity begins at home, do you want to help a local hospice, or perhaps a global issue like Malaria? This is a chance to support what really matters to you.
  1. Which charities working in that area are the most effective?
    Look at their website and see what their impact has been and how they measure it?  Does their work make a big difference to key issues?
  1. Get a bigger bang for your buck
    To make your donation go further, you can ‘gift aid’ it and HMRC will add to your gift.  Charities can claim an additional 25p for every £1 you give.[2] If you are a higher rate taxpayer then the charity will receive an extra 25p for every £1 donated and you will be able to claim the difference between the rate you have paid (45%) and the basic rate on your donation.  Hence if you donate £100 to charity, the charity can claim gift aid on the donation and thus will receive £125 but you can personally claim back £25.00 (£125 x 20%).
  1. Identifying an effective charity
    The popular idea that money spent by charities on administration is ‘wasted’ is wrong. Kids Company had very low overhead costs and were inefficient. High-performing charities spend more on administration costs than weaker ones[3]. The impact is far more important than admin but good governance, leadership and strategy are also essential.

Donating money is not the only way you can offer support. What about-

  1. Food or item donations
    You could donate food items – at a local foodbank or at a supermarket.  Or giving ‘pre-loved baby items’ to families in need via a charity shop. Make sure that the items you donate are of good quality. It can cost charities money to deal with unsellable items.
  1. Volunteering
    Many charities need volunteers to work in their shops, provide admin support or to help with fundraising. Try this link. 
  2. Consider becoming a charity Trustee
    Right now, there are more than 100,000 vacancies for volunteer Trustees in England and Wales alone. This can be a rewarding way of supporting a charity, helping share your skills with governance, strategy, or perhaps support to the management team.

[1] Charities Commission
[2] https://www.gov.uk/donating-to-charity/gift-aid
[3] Fiennes, C. 2015 ‘Charities and Administration Costs’ Giving Evidence

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