Gift Aid > Records

Keeping Records

The importance of keeping accurate records in order to meet the requirements of the Inland Revenue cannot be stressed enough. It is essential that the Church keeps sufficient records to show that the tax reclaims are accurate. These records should enable the church to show:

• an audit trail linking each donation to an identifiable donor who has signed a valid Gift Aid declaration
  and
• that all the other conditions for the tax relief are satisfied.

If adequate records are not kept there may be a requirement to pay back to the Inland Revenue any reclaimed tax with interest. There may also be a liability to a penalty.

You should therefore keep records which will satisfy the Inland Revenue. In the event that the Inland Revenue audits a tax reclaim the auditor will usually ask to see in respect of a donation:

• any written Gift Aid Declaration
• in the case of an oral Gift Aid Declaration before November 2005, a copy of the written record sent to the donor
• any correspondence to or from the donor which relates to his or her Gift Aid donations, including
  - any notification of a change of name or change of address
  - any notification of the cancellation of the Gift Aid Declaration
• the bank statements
• the paying-in book stubs showing details of all cheques and cash banked
• the cash book recording the receipt of cash donations
• a sample of the envelopes and a record of the sums enclosed
• any other records that are kept relating to the donation

Some of these records will be held by the Treasurer, rather than the Gift Aid Secretary.

Records do not have to be kept on paper. They may be held on the hard drive of a computer, floppy disc or CD ROM, or stored on microfiche. Signed declarations should be kept in a form that preserves the signature – for example, by microfilming or electronically scanning them.

If you keep your records on computer, it is advisable to make regular back-ups and store these in a different location to the computer.

The Church is treated as a charitable company for the retention of records. Records must be kept until six years after the end of the accounting period to which any tax reclaim relates. This is a minimum period. In the event that the Inland Revenue audits your tax reclaim and the auditor identifies errors, he or she may re-open the tax reclaims for earlier years. Therefore, it is in the church’s interests to keep records longer than the minimum period. Gift Aid Declarations are usually not time defined, and will need to be kept indefinitely.

Follow these links for details of keeping Standing Order records, Envelope records, and Cash and other donations.