As we approach tax return season it is worth reminding you that you can reduce your adjusted net income by either:

• making a personal contribution to a registered pension scheme , or
• making a donation to a UK charity under Gift Aid.

Pension contributions must be made in the same tax year so you are too late to reduce your tax for 2023/24 in this way.

However, it is possible to treat a charitable donation made now as if it had been made in 2023/24. When that is done, it has the effect not only of reducing the adjusted net income by the amount of donation grossed up for basic rate tax, but it also expands the band for income that is taxable at basic rate by the same amount.

If your income has crept over £100000, then you can use a charitable donation to take it back down.

If you are not in self-assessment, you may still want to get the benefit of a charitable donation if, for example you have a capital gain, partly taxable at higher rates.

What can go wrong?

A single payment to a charity cannot be apportioned between tax years.

The claim must be made on the initial return submission and not in an amended return.

The return must be filed by 31 January 2025.