Charitable giving - cap on tax relief

Currently individuals can offset their entire income against income tax reliefs, and as
a result pay no income tax at all. Budget 2012 announced from 6 April 2013 there
will be limits to the amount of income tax relief individuals can claim.

This cap will apply only to reliefs which are currently unlimited. This cap will be set at
25 per cent of income (or £50,000, whichever is greater).
That means an individual with an income of £4 million will still be able to give £1
million to charity - or offset £1 million of income against their business losses – and
still get full tax relief for that £1 million.

Of course individuals who want to give more than 25%, or £50,000, of their income
to charity will still be able to do so from their taxed income.

More: www.hm-treasury.gov.uk