Charities pay price of cut in tax base rate

Cutting the basic rate of income tax to 20 per cent has left charities nursing a £71 million headache.

Charities' groups said they would be talking to the Treasury to try to find a way out of the problem.

Charities reclaim about £625 million a year at the 22 per cent basic rate of income tax through the gift aid system. The cut to 20 per cent could see this fall to £554 million.

Oxfam will lose £1.8 million a year while the bill is likely to leave the Church of England up to £7 million out of pocket. Read more