The Government is to shortly make amendments to the Finance Bill to stop people gifting stocks and shares to charity but for their own benefit. Anyone that makes a gift of stocks, shares or property can currently claim tax relief. This is based on whatever the market value of the gift to charity is.
The Government is concerned because they have uncovered cases where the market value of gifts is being massively inflated, resulting in excessive income tax relief being claimed. The amendments to the Finance Bill will mean that an individual will not be able to claim more than the net benefit to the charity.
Our View
This story is bitter sweet because it could discourage gifts to charity. But, mis-claiming income tax relief is fraud. There will always be people that abuse the system but at least the Government is only amending the Finance Bill to flush these people out.
Income tax relief can still claim the tax relief they are due.