Charity Accounts

One method of regular planned giving that should be better known and more widely used by tax efficient givers is charitable giving accounts. Deposits into the charitable account are made in a number of ways including a Direct Debit drawn from the donors bank account. The tax reclaim on the gift through the Gift Aid scheme is automatically reclaimed from HM Revenue and Customs. The gross amount is then available for distribution by the donor to the church, charity, school or hospital of their choice.

Charitable giving accounts enable giving to be anonymous should this be desired and money can be left in the giving account should needs arise in the future. Note that a small fee is charged to cover administration costs and that there are reasonable minimum amounts on deposits and on gifts made. Gifts can can be made in two ways:

• Regular gifts can be made to churches and charities of choice by BACS transfer. These gifts made can be gross or net of the tax depending on the donors instruction
• One off gifts can be made by writing a "charity cheque" and forwarding it the charity that manages the charitable giving.

In the UK there are two main charities which offer charitable giving accounts. Stewardship serves the Christian community through their Sovereign Account, which can be funded through a donor’s bank account or their payroll.  They also offer a ‘Sovereign Gold Account’, available to donors who wish to make an initial deposit of £10,000 or more.  This account effectively gives the benefits of a charitable trust but without the usual complications. Through the Sovereign Account, gifts can be made to both Christian and secular charities as well as to Christian workers and bible college students.

The largest provider of charity accounts is the Charities Aid Foundation. CAF offer online management of their charity accounts and also a CAF Family Account to introduce kids to charitable giving. In 2002 CAF launched Charity Bank, the UK's first not for profit bank. Charity Bank offers affordable loans to charities and deposit accounts where supporters can donate their interest to charities of their choice.