3.36.1 Whether or not collections made for a particular charity by churches (which are themselves charities) can fall within the churches’ Gift Aid Scheme will depend on the particular circumstances. 3.36.2 If the church has not exercised any discretion in collecting the donations and the donations are merely given to the church to simply pass on to a particular charity then the:
church has no entitlement to the donations (and they do not form part of the church’s income)
church is merely acting as a conduit and it’s the charity that’s the donee
charity must claim any Gift Aid tax relief (subject to the normal requirements, Gift Aid declaration and audit trail)
3.36.3 However, if the church exercises its discretion and decides to open a fund for donations to a particular charity, then the:
fund is a restricted fund of the church
church is the donee and the donations form part of the church’s income
church is able to claim any Gift Aid tax relief (subject to the normal requirements)
3.36.4 The church is legally obliged to pass the tax associated with a Gift Aid payment to the charity. The donor would have made their donation in expectation that both the Gift Aid donation and the associated Gift Aid tax would go to the charity for which the collection was made.