Gifts of quoted shares and land to charity

Produced by Tolley

The following Personal Tax guidance note Produced by Tolley provides comprehensive and up to date tax information covering:

  • Gifts of quoted shares and land to charity
  • Meaning of ‘charity’
  • Qualifying investments
  • Further conditions specific to qualifying land
  • Date of disposal
  • Value of the asset
  • Donation
  • Sale for less than market value
  • Mechanism of income tax relief
  • Accelerating income tax relief
  • More...

Gifts of quoted shares and land to charity

Donations of quoted shares or land and buildings (rather than cash) to UK charities provide income tax relief for the taxpayer.

The mechanism for income tax relief is different from gifts of cash. Where qualifying non-cash assets are gifted, the market value of the asset is deducted from the taxpayer’s total income rather than adjusting their basic rate tax band. For details of tax relief on cash donations, see the Gifts of cash to charity guidance note.

Relief is claimed on the tax return by reporting the value of the asset in box 9 or 10 (depending on the type of asset gifted) on page TR4 of the main tax return. There is no facility to report the donations on the short tax return.

From 6 April 2012, taxpayers are able to obtain a tax reduction where they gift pre-eminent objects of national importance to the State. This is referred to in the legislation as ‘gifts to the nation’ and is also known as the ‘cultural gifts scheme’. The individual receives a tax reduction (against the combined income tax and capital gains tax liability) which is equal to 30% of the market value of the object. Note that whilst this is not a donation direct to charity, it is a philanthropic gift and the State will lend the items to charitable institutions such as museums. For more details, see Simon’s Taxes C3.1904.

Donations to charity are not included in the cap on unlimited income tax reliefs. See the Cap on unlimited income tax reliefs guidance note for more information on the cap.

For additional commentary on gifts of quoted shares and land to charity, see Simon’s Taxes E1.813.

Meaning of ‘charity’

The definition of charity was significantly altered with effect from 6 April 2012, extending UK income tax reliefs to charities based overseas in ‘relevant territories’ (ie countries in the European Economic Area). The EEA is comprised of the EU Member States plus

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