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From April 2013, charities will be able to claim "top-up payments" on up to £5,000 a year of small donations without needing Gift Aid declarations, under changes announced today in The Queen’s Speech.

The Gift Aid Small Donations Scheme will boost the income of charities and reduce their administrative burdens as they will not have to collect Gift Aid declarations on all small donations.

The top-up payment will be 25p for every pound collected in the United Kingdom, on up to £5,000 of donations, where the individual donations are £20 or less.

Chloe Smith, Economic Secretary to the Treasury, said:

“This scheme will be particularly helpful for small charities that rely on bucket collections, which can find it impractical to get the necessary paperwork that Gift Aid requires. Charities and Community Amateur Sports Clubs will now be able to claim a Gift Aid-style payment on small donations without the need to collect donors’ details.”

Charities must have a three-year record of successfully claiming Gift Aid and continue to make Gift Aid claims to qualify. This is to reduce the risk of fraud.

HMRC is consulting on the final policy until 25 May - see The Gift Aid Small Donations Scheme.

HMRC is also organising a second public meeting on 17 May from 10:00 to 11:30 at 100 Parliament Street, London, for people to raise questions with the policy team about the Gift Aid Small Donation Scheme - The Gift Aid Small Donation Scheme: Second Public Meeting