What do we need to know when someone gives us shares or land?

England and Wales: This page sets out the position in full. Income tax, corporation tax and capital gains tax are reserved to the UK Parliament, so the donor’s relief works the same way everywhere in the UK. Scotland: the same relief and the same land certificate — the reservation is in the Scotland Act 1998, Schedule 5, Head A1. The one difference is the tax on the land transfer itself: LBTT, not SDLT, and an outright gift needs no LBTT return at all. Northern Ireland: the same position as England, including SDLT on land.

Is a gift of shares or land Gift Aid?

No. A gift of shares or land does not go through Gift Aid at all: the donor deducts it from their own taxable income instead. Gifts of shares and land get the same relief across England and Wales, Scotland and Northern Ireland. The trustees decide whether to accept one.

The tax on land the charity buys, rather than receives, is on a separate page: claiming relief on property transactions.

Most charities meet this question with Gift Aid in mind. That is the wrong model, and it leads to wrong advice. HMRC’s own guidance says so in terms:

“do not fall within the Gift Aid Scheme, as they do not take the form of payments of a sum of money” — HMRC Charities detailed guidance notes, Chapter 5.23.1, verbatim.

An individual takes the gift off their income for the tax year of the gift. A company takes it off its profits for the accounting period.

The second difference matters more. In Gift Aid, a benefit to the donor above a limit can cost the whole gift its relief. Here, nothing works like that. A benefit to the donor is taken off the value, pound for pound. The rest of the relief stands.

The statute does use the word “disqualifying” once. It means something else entirely: a later event, for land only, covered below.

Which gifts of shares and land qualify?

Qualifying investments are the assets this relief covers:

• shares or securities listed on a recognised stock exchange, or dealt in on AIM or the PLUS-Quoted market
• units in an authorised unit trust
• shares in a UK open-ended investment company
• an interest in an offshore fund
• a qualifying interest in UK land

A qualifying interest in land is the freehold, or a lease that is a “term of years absolute”. An agreement to buy a freehold does not count. Nor does an agreement for a lease.

The donor must give away their whole beneficial interest. If two people own the land together, both must give it, or neither gets relief. So a house the donor keeps living in for life does not qualify. HMRC’s guidance confirms this.

Scottish land is not left out by the English wording. The Acts translate “freehold” and “leasehold” into the Scottish equivalents.

How the donor’s relief is worked out

For an outright gift, the amount the donor can deduct is:

• the value of the gift to the charity, which is normally its market value
• plus the incidental costs of giving it, such as valuer, legal, broker or conveyancing fees
• minus any money or benefit the donor, or a connected person, receives because of the gift

If the answer comes out below nothing, it is nil. A sale to the charity at less than market value uses a different formula. That is one for the donor’s adviser.

Individuals claim income tax relief. Companies claim corporation tax relief, and the gift counts as a qualifying charitable donation. A company’s deduction can take its profits down to nil, but no further.

Capital gains tax: the donor’s relief and the charity’s base cost

The donor also pays no capital gains tax on the gift. The law treats it as giving neither a gain nor a loss. This is a separate relief, and the donor gets both on the same gift.

The gift has a knock-on effect for the charity, and it is often missed. Your own cost of the asset, for tax purposes, is cut by the amount of the donor’s relief. This happens whenever the relief is available, whether or not the donor claims it.

So if you later sell the asset, your gain on paper is bigger. It is usually exempt if you spend the money on your charitable purposes. But tell the trustees when you accept the gift. Do not leave them to find out on the sale.

The gift itself is also free of inheritance tax, in lifetime or by will. That is separate from the lower rate an estate can get by leaving part of it to charity. Tell the donor both exist, and leave the working to their adviser.

When does the charity have to give a certificate?

For a gift of land only. The donor cannot claim any relief until they have a certificate from the charity, and this is the one hard duty on the charity’s side.

For individuals, that is the law in section 441 of the Income Tax Act 2007. For companies, it is section 213 of the Corporation Tax Act 2010. Without it, the donor loses the relief completely. It is not just useful evidence.

The certificate must contain three things:

• a description of the interest in land
• the date of the gift
• a statement that the charity has acquired that interest

There is no set form. You can write it your own way.

For shares, there is no certificate. The donor needs a dated copy of the transfer form, or another dated document giving the shares to the charity for good. You should keep a copy too. That is good practice, not a legal condition of the relief.

Anti-avoidance rules on gifts of shares and land

Most gifts never meet these rules. They matter when a gift is recent, unusual or comes with strings.

Recently bought as part of a scheme. The relief can be capped at what the donor paid, not the market value. The cap applies where the investment (or something it derives from) was acquired by the donor within 4 years before the gift, as part of a scheme/arrangement, where a main purpose of entering the scheme was to obtain or increase relief. HMRC's Example 5 (Ch5.9.7): a donor buys £200,000 of shares for £30,000 with a buy-back option attached, then gifts them 2 days later — relief is restricted to £30,000 (acquisition cost), not £200,000 (market value).

Land that comes back to the donor. This is the “disqualifying event”. It happens if the donor, or someone connected to them, gets any right in the same land again within a set time. That time runs to the 5th anniversary of the normal self-assessment filing date for the tax year of disposal (individuals); 6th anniversary of the end of the accounting period of disposal (companies). The relief is then treated as never given — a full clawback. There is no equivalent rule for shares.

Tainted donations. For individuals, the Act says this relief is also subject to the general tainted-donations rules. So a gift can be caught by both regimes. For companies, the research behind this page did not find the matching clause in the Act. Treat that point as unresolved, not as proof that companies are outside the rules.

If a gift is recent, complex or tied to conditions, talk to your accountant before you accept it.

Is there stamp duty on a gift of land?

Not on an outright gift in England, Scotland or Northern Ireland, where no consideration means no tax; Wales has not been checked. The donor’s relief is UK-wide. The tax on the transfer of land is not.

In Scotland, the tax is LBTT. An outright gift, with no debt and nothing given back, is exempt, because there is no chargeable consideration. There is no return to make and no relief to claim.

It changes if the charity takes over a debt secured on the land, such as a mortgage. The debt then counts as the price, and the charity must claim charities relief on its LBTT return. The page on claiming relief on property transactions covers that relief.

In England and Northern Ireland, SDLT is built the same way. A gift with no consideration is exempt, and an assumed debt counts as consideration.

In Wales, the tax is LTT. This page has not checked how LTT treats a gift of land. Check it with the Welsh Revenue Authority, or your solicitor, before you complete.

What the charity does, and when to bring in an accountant

The charity’s part is to decide, value, certify a gift of land and keep the records; the donor’s own tax is for the donor’s adviser.

1. Decide whether to accept. The trustees decide, and the decision goes in the minutes. Your gift acceptance policy sets out how — see Can a charity refuse or return a donation?. This guide does not yet have a checklist of what trustees should look at before taking shares or land. HMRC’s guidance only says the donor should check that the charity can accept the gift.
2. Get a valuation. The relief runs from market value. For land, that usually means a surveyor. The valuer’s fees count as incidental costs.
3. For land, give the certificate. Do it once the transfer is complete, with the three items above. A solicitor will usually handle the transfer itself.
4. Keep the records. Keep the certificate or the dated transfer form, the valuation and the trustees’ decision. Note the base-cost reduction for any later sale.
5. Check for conditions. If the donor ties the gift to a purpose, treat it as a restricted fund. How do I account for a grant that has to be spent on something specific? covers how. If you plan to hold shares as an investment, your reserves policy is the place to say why.

How the gift goes into the accounts is a separate question. No step in this guide covers recognising a donated asset yet.

The charity tells the donor which reliefs exist. It does not work out the donor’s tax. The donor’s relief, their capital gains position and any inheritance tax planning are for the donor’s own adviser.

Bring in your own accountant as soon as any of these is true:

• the gift is land
• it is worth a large sum
• it was bought recently
• it comes with any condition or benefit to the donor

For land, you will usually also need a surveyor for the value and a solicitor for the transfer.

That is the last page in this hub. Once the decision is minuted and the records above are kept, the gift is complete on the charity’s side. What charity minutes must contain covers the minute.

Common mistake: treating it as Gift Aid

The Gift Aid rules on donor benefits do not apply. A benefit to the donor is taken off the relief pound for pound. It never cancels the whole gift’s relief. The only “disqualifying” event is a later one, for land, when the donor or a connected person gets rights in the same land back.

Common mistake: thinking shares need a certificate

They do not. The certificate is for land only. For shares, keep a dated copy of the transfer form. That is good practice, not a condition of the relief.

Common mistake: accepting a house the donor still lives in

It does not qualify. The donor must give away their whole beneficial interest. Keeping the right to live there for life means they have not.

Worked example

An individual gives a charity shares in a company listed on the London Stock Exchange. The gift is outright. There are no costs and the donor gets nothing back.

The donor’s relief is the market value of the shares on the day, plus nothing for costs, minus nothing for benefits. They take that amount off their taxable income for the year. They pay no capital gains tax on the gift either.

The charity needs no certificate, because these are shares. It keeps a dated copy of the transfer form. It also tells the trustees one thing at the start. If the charity ever sells the shares, its own cost for tax is reduced by the donor’s relief.