Arcane tax rules prevent charity service users having their say on key issues, campaigners warn

Charity

Charity service users could be being prevented from having their say on services that affect them due to arcane tax rules, campaigners have warned. 

A coalition of charities, campaigners and individuals have written to Lucy Frazer, the new Financial Secretary to the Treasury, to request changes to tax and benefit rules. 

Campaigners have highlighted how many organisations such as charities and universities ask people with lived experience of issues such as poverty and homelessness their views to help shape and improve their services.

They said that best practice is that participants are paid for their expertise and the government often mandates this to be the case, for example in the accreditation of university courses. 

But research by the Austerity Action Group found that more than one-third of people giving their advice and expertise through research and involvement opportunities said they accepted a reduced rate of payment for their time, or only took expenses due to worries that remuneration for their expertise would affect their benefits or tax. 

In more than one-fifth of cases no payment was made, which was more likely to affect those with a long-term health condition, disability, people of colour and other marginalised groups.

One respondent said: “Using lived experience is not cost-free, either emotionally or physically. If I am making a contribution to a project I expect to be paid, just like all the other professionals or consultants around the table. 

“There also needs to be payment for preparation. It is not easy just to rock up and share some very traumatic and discriminatory experiences about services.”

Campaigners are calling on the government to make two changes to tax rules ahead of this month’s Autumn Budget to ensure that participating in research and involvement opportunities is exempt from tax.

In addition, they are asking for clarity that this earnings exemption also applies to income assessed for benefits thresholds.

Angi Naylor, a social worker and member of the AAG, said: “We rely on people with lived experience of issues to contribute to research and service development. It’s a key way that we can create new services or policy recommendations. 

“But tax and benefit rules mean that these people aren’t being rewarded for their time and expertise. These people are experts through lived experience and should be treated as such.”

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