What is Payroll Giving? 

Payroll Giving is a simple and tax-efficient scheme that allows your employees to regularly donate to charity directly from their gross salary. Whatever the size of your business, Payroll Giving is quick and easy to put in place and helps raise millions of pounds a year for good causes. 

How does Payroll Giving work?

Setting up and running a Payroll Giving scheme is quick and simple. Once you have your scheme in place, your employees will be able to sign up to start donating. Then, each payday, their chosen donation amount is taken directly out of their gross salary by your company’s payroll department. The donation is taken after National Insurance is deducted, but before tax.  

All employees’ donations are sent directly to a Payroll Giving Agency (PGA) who will handle the transfer of the funds to Shine or any other charity they have chosen to support. 

What are the benefits? 

Corporate Social Responsibility is crucial whatever the size of your business, which is why more employers than ever are implementing Payroll Giving Schemes. Below are some of the benefits of offering Payroll Giving to your employees. 

For your company

Recognition - The Quality Mark Scheme and National Payroll Giving Excellence Awards recognise your business’ commitment to good causes through Payroll Giving. 

Low effort - Virtually no set up and running costs and minimal administrative requirements since all modern payroll systems are equipped to process donations. 

Easy reporting – Modern payroll giving systems provide you with the monthly value of your employees’ payroll giving donations to monitor and measure your organisation’s contribution. 

For employees 

Good value - It’s the only way to give that allows full tax relief on donations.

More control - Donors have full control over their donation and can easily stop or change their gift at any time.  

Great for busy people - Running marathons and baking cakes isn’t for everyone. Payroll Giving is ideal for busy people who prefer something quick and easy. 

Donor privacy - No banks details are given out to charities and donors can choose how their chosen charity contacts them. 

For charities 

Regular income - Regular and reliable income allows charities to budget for the future.  

Higher value gifts - Since donors benefit from tax-relief, many are encouraged to give a little more than they might otherwise. 

How to set up a payroll giving scheme 

Get everyone on board - By getting the support of senior management, payroll and your HR teams, the process will be simple. Let them know how great Payroll Giving is, and the benefits of giving regularly to Shine. 

Sign up with a payroll giving agency - If you haven’t already, sign up to a Payroll Giving Agency – they are the facilitators of Payroll Giving and distribute the funds that your employees donate. Since donations are made through gross pay, HMRC need an audit trail to ensure money is going to the right places. A list of PGAs approved by HMRC can be found on the HMRC website here.

Promote the scheme to staff - Promoting the scheme is really important as many of your employees may have never heard of Payroll Giving. Promotions can be great fun and help build staff morale. See below for ideas on how to do this effectively. 

Employee sign-up - Your staff sign up to Payroll Giving through your chosen Payroll Giving Agency. 

Donations begin - Now that you’ve got the Payroll Giving scheme in place, and your employees are all on board, your payroll team can start making the deductions each payday. 

Get recognition for your schemes 

The Payroll Giving Quality Mark celebrates the achievements of employers who have adopted and successfully promoted Payroll Giving schemes in their workplaces. Employers who receive a Quality Mark will receive a certificate and Quality Mark logo, which can be used on company literature in recognition and celebration of their achievement. 

How to apply for a quality mark? Your Payroll Giving Agency will monitor the employee participation rates you have achieved and will allocate a Payroll Giving Quality Mark in line with the criteria.  

The National Payroll Giving Excellence Awards – These awards are designed to showcase the best Payroll Giving schemes in the UK and are awarded in an annual Payroll Giving Excellence Award ceremony. Any employer who has achieved a Quality Mark in the preceding year is eligible to submit an entry for an award.  

For more information, or to submit an application for an Excellence Award, contact your Payroll Giving Agency or visit the Payroll Giving Centre website here

Running a payroll giving promotion 

Promoting your Payroll Giving scheme is essential in achieving good participation rates. Here are our top four recommendations for making the most of your scheme.

Make it easy to sign up 

  • Having a sign-up desk in a busy location is the most effective way to get people on board with Payroll Giving.  
  • Use emails and the company intranet to enable staff to sign up instantly online via a link provided by your Payroll Giving Agency. 
  • Ask your Payroll Giving Agency to provide you with a simple form which you can give out to staff. To sign up, they simply fill out the form and return it to your payroll department. 

Incentivise your workplace

  • Set a goal to challenge employees to achieve new levels of participation. Publish this goal and keep updating it as the promotion continues to keep staff motivated. 
  • Thank your employees and celebrate contributions. Use your success stories as a positive PR opportunity.  
  • Offer your employees something in exchange for signing up - sweets, badges, a coffee, a dress down day etc. 
  • Organise a free draw for everyone filling in a Payroll Giving form during the promotion – an extra day’s holiday is always popular.  
  • Consider matching your employees’ donations and, if you decide to do so, publicise this to your employees as it can be a powerful incentive. 

Capitalise on the peer effect

  • Recruit a committed group of staff volunteers. They can be invaluable in promoting schemes to their peers.  
  • Get your senior managers to set an example and be the first to sign up publicly.  
  • Foster some healthy competition by publishing league tables based on department/division/location showing how many people have signed up. 

Get the timing right 

  • Pick a time when levels of motivation are likely to be high, before holidays, after ‘good news’ announcements and pay rises. 
  • Put reminders about payroll giving in payslips. 
  • Run regular promotions to maintain awareness and continue to recruit new donors throughout the year.  
  • Enclose promotional materials in induction packs to inform new staff about the scheme. 

If you need any further information please contact us at fundraising@shinecharity.org.uk or by calling 01733 555988. 


How do I choose a Payroll Giving Agency (PGA)? There are a number of HMRC registered PGAs to choose from. A list of PGAs are available at the end of this guide. Once you have chosen a PGA, you will be able to download a copy of their registration agreement from their website or simply call them and they will send one to you. All you have to do is fill it in and return it to them. 

What role will my payroll department take? Your payroll team will play an integral part of the scheme, with minimal effort. The great thing is all modern payroll systems can implement Payroll Giving easily, usually through a simple ‘tick box’ option. Once your employees have signed up, your payroll department will then deduct the donations each payday (whether weekly or monthly). The total sum of donations from all employees will then be sent to your PGA. The PGAs will be on hand throughout the process to help answer any questions your payroll department may have. 

How are the funds transferred via PGAs? All funds are sent to your PGA by your payroll department and these are then transferred to your chosen charity(ies). They take a small admin fee – usually around 4% - a tiny fraction when you consider the amount of tax HMRC would take. The donation deductions will then appear on employees’ payslips. Your PGA will also report back to you so that you can keep track of total employee donations. 
How much will the scheme cost to set up? Most employers say there are no identifiable costs in setting up a Payroll Giving scheme. Those that do attribute an expense usually say it’s around £100 (including staff time).  

What is ‘matched giving’? ‘Matched giving’ is a powerful and popular way of encouraging employees to sign up to Payroll Giving. Companies can decide whether they would like to match an employee’s donation (as much, or as little as you wish). The matched amount is then added to the employee donations, giving employees an incentive to start Payroll Giving and make their charitable donations go further. 

How flexible is payroll giving for my employees? The scheme is as flexible as your employees want it to be. They can increase, decrease, start or stop their donations at any time. Another benefit of the scheme is that donations can be made to one or more charities – all they will need to do is specify which charities they would like their donations to go to. 

Why do we need to sign a payroll giving contract? A contractual agreement will secure your working relationship with a PGA and provides HMRC with the necessary audit trail for pre-tax payroll deductions. The contract authorises the employer to commence deductions. 

How much do PGAs charge? Most PGAs make a small administration charge (0-4%) which is deducted from the employee’s donation before being sent on to the charities. A growing number of employers choose to pay the administration charge on behalf of their employees to ensure that their full donation is received by the charity. 

Payroll Giving Agencies (PGAs) 

A list of PGAs approved by HMRC can be found on the HMRC website here.

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