Donating a car etc. to charity: Tax implications

Hi there,

What's the procedure for donating to charity in the UK- Is it like in the U.S. where you can claim each item as a tax deduction when you file to get a refund, and actually dictate the market value of those items yourself?

How about with a car? I once donated a car in the U.S. to charity and it worked out very well because the tax write-off was about as much as the price I would have had to sell it for in the used car market, plus I (finally) did a good deed. Are there (church-run?) charities which are looking for cars and can you dictate or at least influence the market value of the car on your tax return (assuming you can claim it)?

Thanks!

Donations of property are not tax deductible in the UK except for items in the following categories

*Shares and securities listed or dealt in on the UK Stock Exchange, including the Alternative Investment Market.
*Shares and securities listed or dealt in on recognised foreign stock exchanges.
*Units in an authorised unit trust.
*Shares in a UK open-ended investment company.
*Holdings in certain foreign collective investment schemes.
*A qualifying interest in land. A qualifying interest in land is the whole of a person's beneficial interest in freehold or leasehold land in the UK.

UK charity information: 

No deduction for donation of items (except as noted by Guya), only cash. 

If a museum, church, or other charity participates in "Gift Aid", then any donations you make can be listed individually on your return.  You need to find out at the time of the donation.  Museum annual memberships and entrance fees count, provided the museum participates in Gift Aid.

There are workarounds regarding donations of very valuable items.  This is usually done via auction or sale; where the proceeds are then delivered to the charity.  However, the proceeds are subject to UK capital gains tax, so the deduction is somewhat lessened.

There are also workarounds related to deductions for donations of items on a UK inheritance return.  That is, if you die and leave your Van Gogh to a museum, the government will adjust your IHT tax accordingly.  I don't do UK IHT, so I don't know how this works; as a member of the Art Fund, I know it's done through some sort of negotiation with IR.

Don't quote me as an expert regarding the workarounds!  I most definitely don't know anything about it except that some mechanism of some sort exists in some fashion.

US charity information:

In the US, you do NOT get to dictate the market value yourself.  You must use a realistic FMV.  If the item is of high value, you need an appraisal.  New laws passed this summer have made donations of items of minor value no longer deductible.  These new laws also require receipts for all donations, no matter how small.  Your church, if it doesn't provide a receipt for the collection plate, needs to start doing so now.

The IRS keeps statistics on everything.  In 2003, the "Fair Market Value" of all those used clothes and goods came to $9 billion!  Since this summer, you can't deduct them unless they're in "good" condition.  The bill is specifically referring to items that have a low value, such as socks and underwear. 

Thanks. So much for my donation idea! 

Lizzit, do you have the exact tax law change for the US charity donations?  Sounds very interesting, after years of being able to say pretty much what one thought of the item donated.   Up to $250 anyway.

Thanks!

http://www.irs.gov/pub/irs-pdf/p17.pdf 

page 149 has all the info on the changes made to charitable deductions.