Automating gift aid claims with RPA
Author: Jim Bowes
Jim Bowes, Innovation Director, explores the ways in which Gift Aid claims can be automated with RPA to make the process faster and smoother.
The Gift Aid scheme allows charities to claim tax relief on qualifying donations from UK taxpayers, making a significant difference to UK charities’ revenue.
Between 2018 and 2019, non profit organisations in the UK received an estimated £3.8 billion in overall tax relief. That’s an increase of around £100 million compared to the previous tax year. Of this total, £1.35 billion was Gift Aid. Boosting the revenues of more than 70,000 charities, this particular tax relief scheme was the driving force behind the increase in overall untaxed donations — accounting for 90% of the total rise.
In October, hundreds of the UK’s charities called on the government to temporarily raise Gift Aid from its usual 20% to 25%. The plea highlights the critical importance of Gift Aid to the charity sector, particularly in times of crisis. It seems UK taxpayers agree. Four out of five people who use Gift Aid on donations support such a temporary measure.
Gift Aid challenges
Yet, despite the importance of the scheme, the process by which charities process Gift Aid is still left wanting. For many non profit organisations, claiming Gift Aid from HM Revenue & Customs (HMRC) is a time consuming and data intensive exercise.
But as the world gives way to new and emerging technologies at an exponential rate, the opportunities for charities to tighten up this process are clear and ripe for the taking.
One such technology which presents an opportunity is Robotic Process Automation (RPA). In a nutshell, RPA automates key — and often time consuming — components of a human led workflow.
Automating Gift Aid claims presents a wealth of benefits. It could mean that your organisation can reinvest its time and money into more value added tasks. It will also take pressure off your organisation’s resources.
Many charities pour large amounts of staff time into capturing, following up on and bringing together the data required to maximise Gift Aid claims. For smaller charities, the administrative strain means that they often miss out on making the most of Gift Aid, because they can’t afford to resource the process.
How digital workers can help
To automate an administrative, repetitive task like reclaiming Gift Aid, RPA uses a software ‘robot’ or digital tool. It observes a human carrying out an action, and then maps this action to a process it can execute itself without the need for a human.
These repetitive tasks, once automated, often get assigned to the phrase ‘digital worker’. This is just another term for the computing power which underpins the automation of a task.
A digital worker can be set up to access all of the personal details required by HMRC — from multiple systems if necessary. These details can include things like title, full name, address details, event and donation. It can be set up to enter 1,000 data details in line with the HMRC limits, and then start the process all over again.
Not only does it significantly reduce the cost of claiming, but it also removes the risk of human error in the work. Performing it at a machine speed, administrative teams can once again be freed up to focus on more pressing, value-added tasks.
Processing Gift Aid claims is prime for automation, particularly for large or medium not-for-profit organisations. There’s even potential for increasing the number of people who have opted in for Gift Aid. Because you can use automation to contact potential donors, collect the additional data needed and then update the relevant systems. With the ability to go back up to four years from the point of donation, the potential for retrospective improvement could be huge.
Where to start
For automation to work at its best there needs to be a highly repetitive task with sufficient volume to make an investment in the technology worth the return. The best way to find out if your processes are well suited is to get in touch and ask for a consultation with one of our team.