Gift Aid is a UK tax relief that allows charities and other qualifying organizations to claim back the tax paid on donations made by individuals. When a donation is made under Gift Aid, the donor agrees to allow the organization to reclaim the basic rate tax paid on the donation.

For example, if an individual donates £100 to a charity under Gift Aid and is a basic rate taxpayer, the charity can reclaim an additional £25 from HM Revenue and Customs (HMRC). This means that the charity is able to increase the value of the donation by 25% at no extra cost to the donor.

To qualify for Gift Aid, donations must be made by individuals who are UK taxpayers and who have paid enough tax to cover the amount that the charity will claim back. The charity must also be registered with HMRC and must meet certain other criteria.

Gift Aid can be a valuable source of income for charities, as it allows them to increase the value of donations at no extra cost to the donor. If you are considering making a donation to a charity under Gift Aid, it is a good idea to check with the charity to ensure that they are registered with HMRC and are eligible to receive Gift Aid.