What is payroll giving?
Payroll giving is a tax-efficient program that enables employees to donate to their chosen charities directly from their salary before tax is applied. This scheme allows for easy, regular contributions and provides charities, such as The Carers' Centre, with a steady income stream, while offering employees a tax break on their donations.
There are many benefits:
- Boost your company’s reputation and corporate social responsibility profile
- Virtually no set-up costs
- Easy for employees - staff can easily make regular donations to charities that are important to them.
- Promote charitable giving across your organisation
- Great for staff morale - increases community atmosphere and galvanises employees behind charitable giving.
- Fully flexible - employees can chose to sign up at any point, and stop whenever they want. Staff are free to increase or decrease the amount they donate, change or add additional charities they donate to, as they wish.
How it works
Once you've established a payroll giving scheme, your employees can enrol and begin donating. Each payday, their donation will be automatically deducted from their gross salary by your payroll department.
The deduction occurs after National Insurance has been taken out but before taxes are applied. This allows them to donate at a reduced cost, saving up to 45% through tax relief.
The donations are then sent from your organisation to a Payroll Giving Agency (PGA), which will manage the transfer of funds to The Carers' Centre or any other charities your employees choose to support.
Payroll giving is a great way of providing charities, like The Carers' Centre, with a regular income stream and gives employees a tax break on their donation.
For example:
| Employee pledges | Cost to the employee at the 20% tax rate | Cost to the employee at the 40% tax rate | The Carers' Centre Charity receives |
| £5 | £4 | £3 | £5 |
| £10 | £8 | £6 | £10 |
| £20 | £16 | £12 | £20 |
Getting you set up
It couldn't be easier to get payroll giving set up
1. Get your Payroll, HR and Management teams on board
Explain the benefits to teams such as senior management, human resources and payroll. It will be a simple process if everyone is feeling enthusiastic.
2. Register with a Payroll Giving Association (PGA)
PGAs are the facilitators of payroll giving and distribute your employees’ donations to their chosen charities. They are payroll giving experts and can guide you through the set-up process.
3. Promote to employees
Get your staff excited about the scheme and signed up to support The Carers' Centre via our website.
4. Donations begin
Now that you’ve got a payroll giving scheme and your employees are signed up, your payroll team can start making the deductions each payday.
Payroll Giving Sign Up Form
Fill this out and give it to your payroll team to set up Payroll Giving.
