Donations
Benefit levels:

Donation Amount    Maximum Value
of Benefits

£1 - £100          25% of donation

£100 - £1,000...
Tax Efficient Giving



  •   Gift Aid
  •   Payroll Giving
  •   Gift of Shares
Gift Aid
The opportunity to reclaim the basic
income tax already paid on a
donation

  •   The money must be given by an i...
Gift Aid




                           Basic Rate of Tax
Gift Aid
Amount
           = Donation X   ----------------------...
Gift Aid - Charity




                                  Basic Rate of Tax
                                            20
...
Changes made in the Basic rate of
tax…


So the Government introduced…
Transitional Relief

You apply for Gift Aid using t...
Gift Aid Declaration
  • Full name and address
  • Charity‟s legal name and number
  • Nature of the gift (single or on-
 ...
Gift Aid – Higher Rate Tax Payer




                            Higher Rate of Tax –
                            Lower ra...
Gift Aid - Charity


                                          20
£15.00 = £60            X       ------------------------...
So….

a £60 donation

is worth

£76.92 to the charity

And costs a higher rate
tax payer

£45.00

                        ...
Corporate Gift Aid

             Normal         Sponsorship        Donation

Sales         £ ‘000              £ ‘000     ...
Tax Efficient Giving



  •   Gift Aid
  •   Payroll Giving
  •   Gift of Shares
Payroll Giving
Regular donations made from pay
before PAYE is deducted.

 •   The money must be given by an individual
 • ...
Payroll Giving
Payroll Giving Agency (PGA)

 •   Collect and distribute donations.
 •   Approved and monitored by the Inla...
Payroll Giving Agencies
 •   Charities Aid Foundation
 •   Charities Trust
 •   The Charity Service Ltd
 •   The Embassy o...
Payroll Giving
Professional Fundraising
Organisations (PFO)
  •   Promote and recruit new donors for various
      chariti...
PFOs
 •   Charity Link
 •   Ease2Give
 •   Hands on Helping Charity
 •   Happy 2 Give
 •   Payroll Giving in Action
 •   R...
Payroll Giving
 •   Employer offers / Staff ask for payroll giving
     Employer engages PGA
     Promoted to staff (inter...
Tax Efficient Giving
  •   Gift Aid
  •   Payroll Giving
  •   Gift of Shares
Gift of Shares
The most efficient way to give to a
charity
  •   Full income relief
  •   No Capital Gains Tax
Gift of Shares
 Shares bought for                               £2,500
 Today‟s worth                                  £10...
Propensity to Give

                Extrinsic Factors
                Age, Gender, Social Class


                Intrinsi...
Propensity to Give

                Extrinsic Factors
                Who they are
                Age, Gender, Social Cla...
Propensity to Give

                Extrinsic Factors
                Who they are
                Age, Gender, Social Cla...
Propensity to Give

                Extrinsic Factors
                Who they are
 •   Age /      Age, Gender, Social Cla...
Extrinsic Factors - Age




 • Giving increases with age (people aged
   55-70 make 65% of all charitable gifts)
Extrinsic Factors – Gender




 • More women give than men. They give
   more overall, in more one-off donations
   suppor...
Extrinsic Factors – Gender




 • Female fundraisers generate more
   compliance than males
Extrinsic Factors – Social Class




• Responds more to     • Give for a long term
  requests for small     change in the
...
Extrinsic Factors - Income



 Cash in pocket    Monthly Wages




 Annual Wages       Total Assets
Propensity to Give

                  Extrinsic Factors
                  Who they are
•   Self
    Esteem        Age, Gen...
Intrinsic Factors



Guilt                                                     Disagree Agree

   •    I prefer to give to...
Propensity to Give

                  Extrinsic Factors
                  Who they are
                  Age, Gender, Soci...
Fit with Self

• It‟s rewarding to feel you‟ve helped in some
  way                                          84
• I give t...
Propensity to Give

                       Extrinsic Factors
                       Who they are
•   Charity            Ag...
Why people support the arts



                To enable the
                Arts to happen

                             ...
The 87 Steps of Fundraising
The Steps of Fundraising

  •   Prepare
  •   Identify
  •   Research
  •   Plan
  •   Involve...
Prepare
Feasibility phase:

   •   Need for money?
   •   Value for money?
   •   When do you need money?

   •   Internal...
Case for Support
1. A clearly defined need for support

2. The documentation outlining reason
     • The selling document
...
Identify Targets (internal)
Internal contacts:

  •   Audience/ event guests
  •   Members
  •   Previous donors/ sponsors...
Identify Targets (external)
External contacts:

   •   Existing supporters‟ peers
   •   Typical social/ work circles

   ...
Research
 •   Individuals
 •   Groups
Researching Individuals
Information to find…
  • Giving history
  • Wealth / Ability to give
  • Interests
  • Family back...
Researching Groups
Information to find…
 •   Social Circles
 •   Wealth / Ability to give
 •   Interests

By…
 •   Questio...
Data Protection
Refer to www.institute-of-
fundraising.org.uk for Code of Practice.

Key points:

  •   Do not use/ share ...
Plan
Fundraising plan:

   1.   Internal input (from who?)
   2.   The need
   3.   Timing
   4.   Resources you need
   5...
Plan
Encourage internal buy-in:
  •   Show how all will benefit
  •   Shared targets
  •   Communicate successes
  •   Reg...
The 8 Steps of Fundraising
 •   Prepare
 •   Identify
 •   Research
 •   Plan

 •   Involve
 •   Ask
 •   Conclude
 •   Re...
Involve
Work out key worker, influencer,
manager

  •   1st approach = to involve them
      • Invite to event
      • One...
Involve
 •   Displays (Info / Point of Donation)
 •   Print / Leaflets
     • eg. case for support

 •   “Getting to know ...
Ask
 •    How are they asked?
      • Donations box/ event/ one-to-one meeting

 •    Who asks?

The ask needs to be:
 •  ...
Ask – Direct Mail Letters
   1. Be clear and concise
   2. Provide one paragraph on who you are, why you
      are writing...
Conclude
Letters to individuals:
   •   Thanks for donation / pledge
   •   Reiterate agreement (dates / amounts)
   •   T...
Reciprocate
 •   Make them part of the family
 •   Invite to lunch/ exclusive events
 •   Good news / Bad news
 •   Benefi...
Reciprocate - Benefits

Tangible:                     Intangible:

   •   Tickets                   •   Feelgood factor
  ...
The 8 Steps of Fundraising

•   Prepare
•   Identify
•   Research
•   Plan
•   Involve
•   Ask
•   Conclude
•   Reciprocate
“I‟m sure I have been a „Friend‟ or a
„Patron‟ along the way and have
followed the usual steps in giving
more and getting ...
…Sometimes I think this was achieved
through professionalism - sometimes
exactly the opposite - sometimes the
staff seem q...
Philip Spedding
Senior Manager, Individual Giving
020 7940 6419
Philp.spedding@ArtsandBusiness.org.uk


www.ArtsandBusines...
Pennies into Pounds Masterclass
Pennies into Pounds Masterclass
Pennies into Pounds Masterclass
Pennies into Pounds Masterclass
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Pennies into Pounds Masterclass

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Philip Spedding's presentation
Truro 25th February 2010

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Pennies into Pounds Masterclass

  1. 1. Donations Benefit levels: Donation Amount Maximum Value of Benefits £1 - £100 25% of donation £100 - £1,000 £25 £1,000 - £10,000 5% of donation £10,000 + £500
  2. 2. Tax Efficient Giving • Gift Aid • Payroll Giving • Gift of Shares
  3. 3. Gift Aid The opportunity to reclaim the basic income tax already paid on a donation • The money must be given by an individual • The money must be given as a donation • Donation can be of any size • The donor has to be a UK tax payer • A Gift Aid declaration has to be made (written or oral) • The donor can reclaim any higher rate tax paid
  4. 4. Gift Aid Basic Rate of Tax Gift Aid Amount = Donation X ------------------------- 100 - Basic Rate
  5. 5. Gift Aid - Charity Basic Rate of Tax 20 Gift Aid £15.00 Amount = Donation X £60 ------------------------- 100 -– 20 (=80) 100 Basic Rate
  6. 6. Changes made in the Basic rate of tax… So the Government introduced… Transitional Relief You apply for Gift Aid using the usual calculation and they will then add an additional 3.2% to any donation made during the next 3 years. You can talk about Gift Aid with or without Transitional Relief.
  7. 7. Gift Aid Declaration • Full name and address • Charity‟s legal name and number • Nature of the gift (single or on- going) • Permission to use gift aid • Note stating that the Donor must have paid sufficient income tax to cover gift aid
  8. 8. Gift Aid – Higher Rate Tax Payer Higher Rate of Tax – Lower rate tax Gift Aid Amount = Donation X ------------------------- 100 - Basic Rate
  9. 9. Gift Aid - Charity 20 £15.00 = £60 X ------------------------- 100 – 20 (=80) Gift Aid – Higher Rate Tax Payer 40-20 (=20) £15.00 = £60 X ------------------------- 100 – 20 (=80)
  10. 10. So…. a £60 donation is worth £76.92 to the charity And costs a higher rate tax payer £45.00 11
  11. 11. Corporate Gift Aid Normal Sponsorship Donation Sales £ ‘000 £ ‘000 £ ‘000 Costs 1,000 1,000 1,000 -600 -600 -600 Sponsorship -100 Income 400 300 400 Tax (28%) -112 -84 -112 Donation -100 Profit 288 216 216 188 Effective Cost 72 Gift Aid +28
  12. 12. Tax Efficient Giving • Gift Aid • Payroll Giving • Gift of Shares
  13. 13. Payroll Giving Regular donations made from pay before PAYE is deducted. • The money must be given by an individual • The money must be given as a donation • Donation can be of any size • The donor has to be a UK tax payer • The Government added a further 10% to the donation (stopped April 04)
  14. 14. Payroll Giving Payroll Giving Agency (PGA) • Collect and distribute donations. • Approved and monitored by the Inland Revenue • Can help to promote Payroll Giving in the workplace
  15. 15. Payroll Giving Agencies • Charities Aid Foundation • Charities Trust • The Charity Service Ltd • The Embassy of Man Payroll Giving Agency • KKL Payroll Giving Agency - (JNF Charitable Trust) • Northern Ireland Council for Voluntary Action • Scottish Council for Voluntary Organisations • South West Charitable Giving - (Federation of Master Builders (South West Region) Charity Fund Ltd) • Sovereign Payroll Giving - (Stewardship) • United Way Payroll Giving Service • Working for good Approved Payroll Giving Agencies for particular business sectors: • BEN - Motor and Allied Trades Benevolent Fund • Achisomoch Aid Company
  16. 16. Payroll Giving Professional Fundraising Organisations (PFO) • Promote and recruit new donors for various charities • A commercial organisation, in some cases owned by charities • Paid a fee by the charities if support is generated. • Can work with the charity on developing a campaign. • Most PFOs belong to the Association of Professional Fundraising Organisations (APGPFO) that regulates their conduct.
  17. 17. PFOs • Charity Link • Ease2Give • Hands on Helping Charity • Happy 2 Give • Payroll Giving in Action • Revenue Share UK • Sharing the Caring • Workplace Giving UK
  18. 18. Payroll Giving • Employer offers / Staff ask for payroll giving Employer engages PGA Promoted to staff (internally or by PFO) Staff sign up Employer deducts donations Donations sent to the PGA • PGA distributes donations to charities (- % for PGA and PFO)
  19. 19. Tax Efficient Giving • Gift Aid • Payroll Giving • Gift of Shares
  20. 20. Gift of Shares The most efficient way to give to a charity • Full income relief • No Capital Gains Tax
  21. 21. Gift of Shares Shares bought for £2,500 Today‟s worth £10,000 Income from selling Sale £10,000 Less Capital Gains Tax (18% of £7,500) -£1,350 Cash gift to charity £8,650 Value to charity (inc Gift Aid) £11,089 Final cost to donor (inc Gift Aid) £7,837 Gift of Shares Value to charity £10,000 Final cost to donor (tax relief 40% of £10k) £6,000
  22. 22. Propensity to Give Extrinsic Factors Age, Gender, Social Class Intrinsic Factors Self Esteem, Guilt, Empathy Perceptual Reaction Fit with self, portrayal The Ask Past experience, stimulus
  23. 23. Propensity to Give Extrinsic Factors Who they are Age, Gender, Social Class Intrinsic Factorsabout What they think Self Esteem, Guilt, Empathy Perceptual Reaction Their links to the cause Fit with self, portrayal The Ask Past experience, stimulus
  24. 24. Propensity to Give Extrinsic Factors Who they are Age, Gender, Social Class Intrinsic Factorsabout What they think Self Esteem, Guilt, Empathy Perceptual Reaction Their links to the cause Fit with self, portrayal The Ask Past experience, stimulus
  25. 25. Propensity to Give Extrinsic Factors Who they are • Age / Age, Gender, Social Class Gender • Religion • Social Intrinsic Factorsabout What they think • Income Self Esteem, Guilt, Empathy Perceptual Reaction Their links to the cause Fit with self, portrayal The Ask Past experience, stimulus
  26. 26. Extrinsic Factors - Age • Giving increases with age (people aged 55-70 make 65% of all charitable gifts)
  27. 27. Extrinsic Factors – Gender • More women give than men. They give more overall, in more one-off donations supporting a wider range of organisations • But men make larger individual donations
  28. 28. Extrinsic Factors – Gender • Female fundraisers generate more compliance than males
  29. 29. Extrinsic Factors – Social Class • Responds more to • Give for a long term requests for small change in the donations to situation. relieve pain and • Respond better to suffering messages reflecting a need for long term solutions 32
  30. 30. Extrinsic Factors - Income Cash in pocket Monthly Wages Annual Wages Total Assets
  31. 31. Propensity to Give Extrinsic Factors Who they are • Self Esteem Age, Gender, Social Class • Social Justice • Benefits Intrinsic Factorsabout What they think Self Esteem, Guilt, Empathy • Guilt • Empathy • Fear / Pity Perceptual Reaction Their links to the cause Fit with self, portrayal The Ask Past experience, stimulus
  32. 32. Intrinsic Factors Guilt Disagree Agree • I prefer to give to charities that do not get 17 54 enough government support • There is no point in supporting charities 44 27 which enjoy strong Govt. support • It does not really matter whether I give to 67 11 charity or not, others will • I only get pleasure from seeing the work 59 20 done by charities if I have supported them • I prefer to give to charities in a way that allows them to get more from the taxman 20 46 • I give to reduce my tax bill • I feel that I should give as much to charity as 52 14 other people I know 69 10
  33. 33. Propensity to Give Extrinsic Factors Who they are Age, Gender, Social Class • Social Groupings • Fit with Self Intrinsic Factorsabout What they think Self Esteem, Guilt, Empathy Perceptual Reaction Their links to the cause Fit with self, portrayal The Ask Past experience, stimulus
  34. 34. Fit with Self • It‟s rewarding to feel you‟ve helped in some way 84 • I give to charities because I like the feeling of being generous 20 • I help concerns where my family or friends are involved 76 • I give to charities because I or my family may personally benefit 40 • I give to charities because I want to support the good 80 causes for which they work • I give to charities because they help to make a better society for everyone 60
  35. 35. Propensity to Give Extrinsic Factors Who they are • Charity Age, Gender, Social Class communications • Strength of message Intrinsic Factorsabout What they think • Processing Self Esteem, Guilt, Empathy • Influences Perceptual Reaction Their links to the cause Fit with self, portrayal The Ask Past experience, stimulus
  36. 36. Why people support the arts To enable the Arts to happen To Develop To enjoy Social the Benefits Standing To make a profit
  37. 37. The 87 Steps of Fundraising The Steps of Fundraising • Prepare • Identify • Research • Plan • Involve • Ask • Conclude • Reciprocate
  38. 38. Prepare Feasibility phase: • Need for money? • Value for money? • When do you need money? • Internal buy-in? A good board? • Why is your organisation best? • Staff skills? • Potential support? • Enough resources?
  39. 39. Case for Support 1. A clearly defined need for support 2. The documentation outlining reason • The selling document • An information tool, not the “ask” • Something visual to leave behind Ensures: • Clear rationale behind giving • All staff are on message • What‟s yours?
  40. 40. Identify Targets (internal) Internal contacts: • Audience/ event guests • Members • Previous donors/ sponsors • Address Lists (Shop – Box Office) • Board/ staff contacts
  41. 41. Identify Targets (external) External contacts: • Existing supporters‟ peers • Typical social/ work circles • Profiles in magazines • Keyword searches • Media appearances • Estate agents, LAs • Wealthy areas in neighbourhood
  42. 42. Research • Individuals • Groups
  43. 43. Researching Individuals Information to find… • Giving history • Wealth / Ability to give • Interests • Family background • Who they know • Link with your organisation By… • Asking peers N.B. Use • Friends / social circle a database • Media • Research agency
  44. 44. Researching Groups Information to find… • Social Circles • Wealth / Ability to give • Interests By… • Questionnaires • Focus Groups • Other memberships in area (the market place)
  45. 45. Data Protection Refer to www.institute-of- fundraising.org.uk for Code of Practice. Key points: • Do not use/ share data about individual if they would not wish it • If buy list or information, inform individuals that you hold this • Need consent for email communications to individuals • Sensitive personal data is very protected • The individual has can request a copy • Electronic information is easier to track!
  46. 46. Plan Fundraising plan: 1. Internal input (from who?) 2. The need 3. Timing 4. Resources you need 5. Communications/ events 6. Budget 7. Benefits on offer (cost/ value) 8. Target income … triangle of gifts 9. Benchmarks
  47. 47. Plan Encourage internal buy-in: • Show how all will benefit • Shared targets • Communicate successes • Regular agenda at senior meetings • Reassure them Plan involve/ potential gift/ timetable
  48. 48. The 8 Steps of Fundraising • Prepare • Identify • Research • Plan • Involve • Ask • Conclude • Reciprocate
  49. 49. Involve Work out key worker, influencer, manager • 1st approach = to involve them • Invite to event • One-to-one meeting with influencer • Phone call • How/ what will they learn about your work? • Intentional and unintentional • Involve them further • Active / Passive involvement
  50. 50. Involve • Displays (Info / Point of Donation) • Print / Leaflets • eg. case for support • “Getting to know us” events • more info about organisation • Get them right! • What makes for a good event?
  51. 51. Ask • How are they asked? • Donations box/ event/ one-to-one meeting • Who asks? The ask needs to be: • Clear • Specific • Immediate • Unambiguous • Easy to follow through with gift
  52. 52. Ask – Direct Mail Letters 1. Be clear and concise 2. Provide one paragraph on who you are, why you are writing, what you need and what you will do with it. 3. Keep to one side of A4 4. Add a hand written PS 5. Test the letter on friendly readers 6. Add an image 7. Have it signed by someone important 8. Tailor to the type of person to whom it is being sent 9. Think about the reader - Recognise that they will only give the letter a brief amount of time 10.Make sure the database details are accurate Remember AIDA: Get Attention - Arouse Interest - Stimulate Desire - Prompt Action
  53. 53. Conclude Letters to individuals: • Thanks for donation / pledge • Reiterate agreement (dates / amounts) • Tie in to upcoming events • Link to outcomes • Endorse reasons for giving Beware of cognitive dissonance Public thanks • Print (own / external) • Speech • Events
  54. 54. Reciprocate • Make them part of the family • Invite to lunch/ exclusive events • Good news / Bad news • Benefits • Appropriate to commitment
  55. 55. Reciprocate - Benefits Tangible: Intangible: • Tickets • Feelgood factor • Programmes • Association with Art • Special items • Social standing • Advanced booking • Knowing you‟ve made a • Events difference • Naming opportunities • Supporting education & • Access to artists outreach work • Access to behind the • Being “in the know” scenes • Position on Board 58
  56. 56. The 8 Steps of Fundraising • Prepare • Identify • Research • Plan • Involve • Ask • Conclude • Reciprocate
  57. 57. “I‟m sure I have been a „Friend‟ or a „Patron‟ along the way and have followed the usual steps in giving more and getting more involved - being brought closer in - but this seemed a natural development and I didn‟t feel imposed upon at any point...
  58. 58. …Sometimes I think this was achieved through professionalism - sometimes exactly the opposite - sometimes the staff seem quite amateur... … but charming and well-meaning and passionate and that gets the same result”
  59. 59. Philip Spedding Senior Manager, Individual Giving 020 7940 6419 Philp.spedding@ArtsandBusiness.org.uk www.ArtsandBusiness.org.uk

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