Cash Clinic

Published on Friday 26 December 2008 20:04

Q I would like to send a charity donation to an orphanage overseas. Is it possible to get some form of tax relief on this in the same way I can claim tax relief on donations to UK charities?

PT Fort William

AUp until now, sending money to a charity overseas was not a tax-efficient option. However, good news is now coming out of the European Court of Justice following a ruling which could allow people to make charitable donations across EU borders and still receive tax relief.

A German philanthropist has successfully challenged the current state of affairs in the European courts, claiming tax relief on a donation that he made to a Portuguese children's home. After this was refused by the German government, he took his case to the European Court of Justice and won, subject to a last appeal by the German government.

The judge ruled that the donor could reclaim the tax from the German authorities because there could be no objection to the Portuguese charity.

The Advocate General's opinion is not binding on the Court of Justice. However, if the judgment of the court agrees, the ability for people to make donations tax effectively across borders to causes that are personal to them has got to be good news.

&#149 Fiona McDonald is an associate at legal, financial and property specialists Pagan Osborne.

&#149 If you have a question you need answered, write to Jeff Salway, Personal Finance Editor, The Scotsman, 108 Holyrood Road, Edinburgh EH8 8AS or e-mail: . These answers are for guidance only. No responsibility for loss occasioned by any person acting, or refraining from acting, as a result of these answers can be accepted by Pagan Osborne or The Scotsman Publications Ltd.