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About charitable funds and grants - Benefits and charitable grants

In this section, you can learn more about how charitable funds work and the support, including grants, that they give to people in financial need.

Benefits and charitable grants

What is the difference between a 'benefit' and a 'grant'?

Benefits

Benefits (and Tax Credits) are payments made by the Government to people in certain circumstances, for instance if they are:

  • On a low income

  • Are expecting or bringing up a child

  • Are pregnant

  • Have an illness, disability or injury

  • Are caring for someone

  • Are an older person

  • Have been bereaved.

You can be entitled to particular benefits, if you meet the qualifying rules.

See Your Situation for details of what is available to people in different circumstances.

Grants

Grants are sums of money that charitable funds give for specific purposes to people in need who qualify for their help. They are given as a gift or award, so they don’t need to be paid back.

You do not have an entitlement to a grant, even if you meet the qualifying rules of the charitable fund. They are given at the discretion of each charitable fund.

See About charitable funds for more information about grants

Please note: The Government and other funding bodies also often give grants to people or organisations to pay for particular projects or services.

Do I have to be getting benefits to qualify for a grant?

Although many people who qualify for grants will be getting welfare benefits, you do not have to be getting them to qualify for a grant.

Most charities would not consider an application for a grant where statutory help was available in the form of benefits or for items that there is a legal requirement on statutory services, such as your local council, to fund.

Many charities will ask you about any benefits you are receiving as part of the application process. They may also ask you to check whether you are entitled to benefits if you aren't already claiming any. You can do this using the Turn2us Benefits Calculator.

Will my benefits be affected if I get a grant from a charity?

Regular payments

If charitable payments are made or due to be made regularly then the payments are disregarded as income and do not reduce your benefits.

However if you are on Income Support or income-based Jobseeker's Allowance (JSA) and are involved in a trade dispute then these payments will usually count as income. 

Goods (payments in kind)

If you get goods instead (payments in kind), then this is ignored as income unless you are getting Income Support or income-based JSA and are involved in a trade dispute.

Irregular charitable or voluntary payments

Charitable or voluntary payments that are made irregularly and are intended to be made irregularly are treated as capital under the benefits system and can have an impact on your benefits.

If an irregular payment is provided to a beneficiary and the payment takes your capital above the higher capital limit of £16,000, you will lose your entitlement to means-tested benefits, with the exception of Guarantee Pension Credit (GPC) which has no higher capital limit. If you are receiving GPC, no capital limit would apply to Housing Benefit also.

Whether it is counted as income for tax credits depends on whether the charitable income is taxable. You should inform HM Revenue and Customs (HMRC) who would be able to confirm.

You should get advice from a benefits expert on this subject.  You can use our Find an Adviser tool to find a local expert.

 

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