By Max Clarke

The third sector, of charities and voluntary organisations, was given a prominent role in yesterday’s budget as Chancellor Osborne outlined the details of Cameron’s much touted ‘Big Society’, in which volunteer organisations are to fill the services void left by a declining public sector.

“Normally, you have to crawl through the background paperwork to find reference to the [third] sector”, said Caron Bradshaw, chief executive of the Charity Finance Directors’ Group in an article for Third Sector Online”but in this Budget the prominent role the sector plays has been recognised.”

Policies announced include the removal of paperwork for charities claiming tax-free gift aid donations of up to £5,000, a 45p increase per mile for voluntary drivers allowance, and a 10% inheritance tax relief for those bequeathing their estates to charity.

“The reform of the Gift Aid scheme is a welcome relaxation which will benefit all charities but especially smaller ones,”commented RMS Tenon. “ The new system will allow charities to claim Gift Aid on up to £5,000 of small donations a year — typically given in collection tins and buckets — without the need for declarations.”

Continued Hubbard, “Individuals will also be encouraged to leave 10% or more of their estate through their wills to charity in exchange for an equal reduction in inheritance tax. In addition and the Government is to consult on proposals to encourage donations of valuable works of art and historical objects to the nation, during lifetime as opposed to on death, in exchange for a tax deduction. Neither measure will benefit individuals — solely the beneficiary charities.”

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