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Charity Text Messages to Be Tax Free in the UK
Published on:
Premium rate text messages sent in the UK as a way of donating to charities will no longer be subjected to a sales tax, under a deal agreed by the Mobile Data Association. The new framework means charities of all sizes will be able to receive an additional 15% (standard rate of VAT) for donations sent via text message. In the past this has only happened for large national charitable events such as Comic Relief.
Mobile users can donate up to £10 by either sending a text message to a Short Code or by using Payforit, a recognised UK standard for mobile payments.
Central to the new framework is an allocation of a dedicated range of numeric Short Codes to be used for charity donations only. Any five-digit SMS Text Message Short Code beginning with the number 70 (seven zero) is now automatically considered a charity code which can be allocated to charities eligible under the rules of Her Majesty's Revenue and Customs.
The framework has been approved by UK mobile network operators, 3, Orange, T-Mobile, Telefónica O2 and Vodafone. It enables VAT usually charged by mobile network operators to be passed directly on to the charitable organisation.
Martin Ballard, Operations Director of the MDA, who has driven the initiative, said: "This is a really fantastic development both for the UK charitable sector and a great example of the mobile industry collaborating for a good cause. Mobile is a powerful way for people to support and donate to charities and this development makes the whole process clearer for all parties."
"Sending an SMS message is known to have mass appeal because of the simple user experience across devices. Our hope is that reducing consumer barriers will benefit a range of charities in need of a new, modern and instant fundraising channel. It should also provide welcome benefits and price transparency for those involved across the mobile industry."
The full document, The Mobile Data Association Framework For Charitable Donations, can be downloaded from the MDA's charitytext website at http://www.charitytext.org/the-framework-agreement
Tags: [mobile data association] [text messages] [charity] [text message] [telefonica o2] [vat] [UK]
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