Charities of all sizes will now be able to receive an estimated extra 10p in the pound for text donations of up to £10 made via dedicated 70 prefix short codes. O2 will ensure registered UK charities that opt to use a dedicated short code will receive 90 per cent of the donation. O2 charges a small fee to cover its network costs, VAT on the cost of the text message, insurance against bad debt, and a range of third party costs.
Simon Davis, Head of Corporate Responsibility at O2 said: ”We’re glad to be able to do what we can to help charities carry on their work. O2 is pleased to lead the way in supporting charities in this way.”
This this in addition to the ruling that VAT is not payable on charity donations made via text message. Charities eligible under the rules of HMRC are allocated a dedicated numeric short code for donations only. Any five-digit text message short code beginning ’70’ is now automatically considered a charity code and becomes eligible for the enhanced payout. VAT previously charged on the donation is now passed directly to the charitable organisation. VAT is still payable on the operator’s or aggregator’s costs. Aggregators provide the application and connection to the mobile networks.
O2’s flagship charity programme It’s Your Community aims to inspire young people to take action to improve their communities and get together with others who share common interests and local passions. The programme runs on the principle that, by funding lots of small groups to make a difference across the UK, the collective impact will be far more significant. To date £1.3 million has been donated to over 1,700 projects across the UK.