Money expert Martin Lewis has issued a warning to anyone who gives money to charity.

The financial guru opened up about a little-known loophole around charitable giving and how you can increase the money the charity receives – and reduce your own tax bill a little and recoup money too ‘money.

Martin urged his supporters to “say yes” to something called Gift Aid.

This is a program through which charities can increase your donation by claiming back the tax owed.

He said: “Say yes to GIFt Aid. Because that way the charity gets more and you might get more too.

“Charities lose hundreds of millions of pounds in unclaimed donations every year, so this could do the trick and doesn’t cost you a penny.

“So the simple rule is when you donate if you’re a UK taxpayer it’s crucial, just say yes to Gift Aid, it really is that simple.”

But it’s not just about helping charities – although that’s obviously the best. You can also withdraw money from Gift Aid.

Martin continued: “But let me explain why and why you might be entitled to money in certain circumstances.

“Now the reason this works is that when most people get paid, 20% tax is usually removed.

“So when you get paid, the tax office comes and takes 20% of the amount. So if you earn £25, you take home £20 (although this doesn’t take national insurance into account).

“But Gift Aid means that when you give that £20 to a charity, the charity gets your money back and the tax you paid, which is an extra 25% gain, costs you nothing, but on every £20, it makes five dollars more.

“And that’s not all: if you’re a 40% higher rate taxpayer, so for every £100 you earn you take home £60, the tax office gets £40. If you donate to a charity, the charity still gets the 25% increase as before, so the charity receives more and you can claim back the rest of the tax which you have repaid, to which you can then donate.

“This is usually done via the self-assessment form. So if you are a UK taxpayer and you donate to charity, firstly for the charity, say yes to Gift Aid, but also for yourself, say yes to Gift Aid.

“And if you can, why not also donate the little bit of extra tax you get back to charity.” »