Gift aid: Understanding donor behaviour

Donors are put off claiming gift aid because they believe there will be a cost to the charity or themselves, and are unwilling to share personal information in case they are contacted with a fundraising ‘ask’, according to new research published by HM Revenue & Customs.

The research, entitled Gift aid: Understanding donor behaviour, is part of the government’s work, as announced in this year’s Budget, to encourage more donors to use gift aid. It finds a lack of understanding among donors about how gift aid works, and that this is putting people off claiming the relief.

The National Audit Office estimates that there are donations worth around £2.3billion a year where gift aid is not claimed.  Charities and sector representative bodies have been working with HMRC to improve and simplify the gift aid declaration form.

The research was commissioned as part of the Gift Aid Working Group, set up earlier this year to look at reforming the gift aid declaration and changes to the way intermediaries operate gift aid, in response to the gift aid and digital giving consultation held last summer.

It concludes that decisions about gift aid are often automatic, and the habits of eligible donors who do not claim, and ineligible donors who do, need to be disrupted before their behaviour can change.

Based on interviews with 40 donors and group discussions about different declarations and ways to claim gift aid, including online and via SMS, the research suggests changing the format of the gift aid declaration form to communicate key facts more effectively and make it harder to ignore.

HMRC states that the declaration form could be improved by avoiding excess detail or dense formatting, breaking up the information to make it easier to digest and changing the layout so donors pay more attention to the information.

To deter ineligible donors from claiming, charities need to clarify that they need to have paid tax, and second that incorrect claims are the donor’s responsibility, it says, but these messages must be carefully constructed to avoid discouraging eligible donors.

The research found that participants claimed gift aid if they believed themselves to be eligible, did not feel that claiming would incur any costs to themselves or the charity, and felt the benefits to the charity outweighed the effort of claiming.

As well as being put off it they thought the process would cost them or the charity, and being deterred by sharing information in case they were contacted again for fundraising, donors also showed a reluctance to participate in anything official, and viewed form-filling as inconvenient, the research states.

To download the report visit