HMRC can't Relate to this

12:12pm Tuesday 13th May 2008

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A CHARITY which helps St Albans couples overcome their marriage and relationship problems is being denied a substantial tax refund.

MP Anne Main has challenged Ed Milliband, Minister for the Cabinet Office, over the problems of the St Albans branch of Relate, which is battling Her Majesty's Revenue and Customs (HMRC) over rules which allow it to reclaim tax on donations.

Relate will not disclose how much it is losing out, but it could be thousands of pounds a year.

Mrs Main said: "Relate is a fantastic charity which offers a valuable service.

"I cannot see why they are not being allowed to claim gift aid on donations.

"I will continue to press this issue with the Government to try to ensure that Relate can maximise the value of their donations."

The dispute relates to suggested donations of £40 which couples give in return for consultations on their problems.

Although many other branches of Relate are able to reclaim the tax already paid by the couples, like on any other charitable donation, the St Albans tax office will not accept the sums are genuine gifts.

Although they are given voluntarily, it argues they are payments for services and not eligible for tax refunds.

Mr Milliband told Mrs Main he was sympathetic to Relate and would investigate the problem.

The average branch of Relate gives more than 500 consultations of relationship counselling every year.