UK TAX EVASION under the guise of CHARITY, celebs say they donate profits to charity but when you look further

Question

into the details it just so happens that it is their own charity (Jamie Oliver and Sharon Osborne to name but two).

How do they do this please, can ordinary folk do it?

Answer 1

They give to their own charitable foundation, which then gives the money to charity. They don't just get to keep it and use the donated money for themselves.

Answer 2

Yes we can, not just if you have a limited company. It's called gift aid or payroll givin. When you donate to charity, most people know to make their donations tax efficient so the charity gets the whole amount including what would have been paid in income tax. If you give direct from the payroll, it gets deducted from you pay before tax is paid so is not counted as part of your income for tax.

So say you were a Scout Leader or helper in a refugee centre, you could instead of not claiming for all those little expenses, claim for them, but instead give a huge wadge of cash to the group once a month gross of tax.

What you have to bear in mind that it is the charity that benefits from the tax avoidance, not the giver. The giver really has reduced their income by the amount given.

This system has been known about for years- your employer may talk about payroll giving or charities talk about gift aid.

The issue here is that it doesn't actually benefit the giver, you don't get any tax releif on the portion of your pay you keep to spend on yourself, and the charity can't give you anything of benefit to you for your donation, other than that warm glow that comes from knowing you are a normal person who likes to help others.

The celebs have not increased their personal means one iota by doing this, the tax that has not been paid has gone to the charity, not them. The fact it is a charity close to their heart is no different from any of us giving to a charity we feel an afinity to.

Answer 3

What you mean is they have set up a charity to do work which is close to their heart and they donate to it. Anyone can set up a charity, but there are very strict rules about who could benefit from it. You get tax relief at the basic rate on all gift aided donations to charity and you also get higher rate relief if you are a higher rate taxpayer. Having said that, starting a charity is not to be taken lightly!
Charity accounts have to be sent to the Charity Commission who have powers to investigate charities which appear to be acting unlawfully, for example, George Galloway's charity for children in Iraq has been investigated twice.
You may recall that when the McCanns set up the fund to find Madeleine, they were not allowed to register it as a charity as it was only benefitting one family and a charity (among other things) has to benefit the public at large.

Answer 4

There is nothing wrong with tax avoidance,its only a crime when it become tax evasion, but with the amounts of money these people are earning you would have thought they could really afford to give to real charities. As for the ordinary person in the street doing the same, well i doubt its worth it, even with a good accountant, his bill would be higher than the money you'd save.

Answer 5

You can put money to charity to avoid paying tax if you have a limited company. Which the stars might have.....

Answer 6

Because it is "their own charity" doesn't mean they get anything other than publicity out of it.

Celebrities promote charitable organisations because of the belief that their name brings something extra to it.

And, generally speaking, it does.

Answer 7

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Answer 8

Nobody has any legal or moral duty to pay any more tax than he or she has to.

Answer 9

If you have a good accountant, you may not to pay any tax at all.