This 5th of September is the United Nation’s International Day of Charity, and at The Inspire Network we’re keen to celebrate.
Why? Because we think charities do amazing work! And giving does us good in so many ways!
Charities are responsible for making significant positive changes in the world – whether that be serving the environment, providing aid in humanitarian crises, alleviating suffering of those in need, transforming the lives of individuals or improving communities and our society at large. As such, we believe they deserve our support.
Generosity and giving is good for society, but it’s also good for us. Often as business owners it’s easy to get caught up in making money and trying to set boundaries to protect our time... but giving our money and our time, with a mindset of abundance and the right attitude, is hugely rewarding! It’s true, supporting charities isn’t just good for the charity and the cause they support, it’s good for you too.
With that in mind: here’s why giving is good as a business owner!
1) You’ll live longer
The first reason is the obvious: it just feels good. Whether it’s money, time, or items, giving to charity gives a ‘helper’s high’ that’s more than just the warm fuzzies. In fact, one study from the University of California found that elderly people who volunteered were 44% less likely to die over a five-year period than those who didn’t. And this was after taking into account general health! Giving to charity literally extends your lifespan.
2) Tax efficiencies for companies
For those of you that own companies, there’s another benefit: the financial kind. At its most basic, any money a company donates to charity is ignored when Corporation Tax rolls around – so if you made £10,000 in profit and donated £1,000 of it, the present 19% Corporation Tax would only apply to the remaining £9,000 meaning you’d pay £1,710 instead of £1,900. It’s up to you to decide whether spending £1,000 to support a cause you believe in to avoid £190 going to the taxman is worth it, but we’d like to think it is!
As with everything financial, there are still a few other caveats to bear in mind:
If your company employs an accountant, it’s always worth asking them for their opinion and guidance on how best to donate company money and assets with maximum efficiency.
3) Take your money back from the tax man and give it to charity!
If you don’t own a company but still pay taxes like Income Tax, then the best way to help out charities at no additional cost to yourself is to Gift Aid your donations! And there can be benefits to you personally if you are a higher rate taxpayer.
If you ask a charity to claim Gift Aid for your donation, the charity will take your donation and then reclaim from HMRC the 20% tax that you originally paid. So if you're a 20% taxpayer, this gives the correct tax relief straight away. If you are a higher rate 40% taxpayer, you can claim back extra tax from HMRC. This will be the difference between the higher tax you have paid and the 20% tax already claimed by the charity.
To use Gift Aid, you must have paid enough income tax or capital gains tax to HMRC in the tax year in which you make your donation – at least equal to the amount that the charity (or total given to multiple charities if you support more than one) will reclaim. The charity will ask you to sign a Gift Aid declaration confirming that you pay enough tax to be eligible for them to reclaim this from HMRC. If you’re still uncertain, it will never hurt to get advice from an accountant or personal financial advisor if you have one.
The important thing to remember with Gift Aid is that you can support charities who really need these funds and it won't cost you a penny!
4) What goes around comes around
Whatever your beliefs, most people we’ve spoken to about giving have said the same thing: “what goes around comes around”. As people, there’s something beautiful about giving with a generous heart, with no expectation of reward or reciprocity. And when we do, the wonderful thing is we often DO receive a reward, even if we can’t directly attribute it to a specific act of giving. Good things have a way of happening when you give with a generous spirit. A client who comes to you because someone they know in a charity mentioned your services after you’d donated recently, for example.
There is always a way to give to others and to charity when you decide to prioritise it – whether that’s time, money or both. Sometimes your time is the most precious thing you can give and it is also what many charities so desperately need. So do consider offering up your professional skills or donating products "pro bono" (for free) to charities if you can, and of course, fundraising efforts and other donations of money are always very much-needed. Just pick your causes wisely and ensure you are happy with how your resources will be used.
If you’d like to be a part of a business community where women are encouraged to approach business with an attitude of generosity and kindness, we’d love to have you with us at The Inspire Network. In fact, "Give first” is one of our core values, and our CEO Nikki Tapley gives her own time as the founder and Chair of Trustees of 'Free to Fly', a newly registered charity. If you'd like to find out more about them, they're fundraising to help get their work off the ground. You can find a link here
Giving in all its forms is a good thing, so we hope that this post might inspire you to consider how you can get involved with supporting a good cause on this International Day of Charity too.