Money Helpdesk: Charity donations and tax bills

How can I be sure my charity donations go to the needy instead of the greedy?

I NOTE your comments about charities and fundraising in last week's Scotland on Sunday (Mugging up on charity, 5 September). There are two serious matters preventing me from giving to Pakistan relief. Highly paid staff – I am not willing to feed fat cats – and corruption.

I do not want to support any charity that is guilty of either, and especially both. I do give to the Salvation Army as I know more about how it practises what it preaches. However, my question is: is there a charity helping Pakistan that guarantees my subs will help the victims, and not fat cats or crooks or be spent on overseas jollies?

Teresa Hunter writes:

We contacted the Office of the Scottish Charity Regulator, which says basic information about individual charities is available on the Scottish Charity Register on its website. You need to compare how much is spent on admin and expenses, to see who is giving the most money to the causes you wish to support. This means studying reports and accounts, which are usually published on the charity's website.

We also contacted Oxfam, which confirmed that for the Pakistan appeal, for every 1 given, Oxfam spends 79p directly helping people. A spokeswoman added: "Only 11p is used on running the organisation. 10p is invested in generating more money for our work with poor communities.

"Oxfam has stringent procedures to monitor and evaluate all our work and ensure aid gets to those that need it. When we uncover fraud we act fast, and will prosecute those responsible and seek to recover the money.

"No system is 100 per cent infallible, but we are confident we have systems in place to minimise the risks and ensure the best possible use of the money given to us.

"All our large-scale aid projects (over 1m] are subject to independent review to ensure value for money. Results of our reviews are on our website: www.oxfam.org.uk/resources/evaluations."

Will my tax bill fall?

I am on the verge of being a higher-rate taxpayer this year and understood from the Budget in June that I will have an increased personal allowance so will pay less tax next year. Do I really stand to benefit from these changes?

Susannah Simpson, senior tax manager at PricewaterhouseCoopers, writes:

All individuals under the age of 65 are entitled to a personal allowance within which they do not pay tax on their income. After two years with the personal allowance fixed at 6,475, the government announced that, rather than simply increasing the basic personal allowance in line with inflation from 6 April, 2011, the basic personal allowance will be increased to 7,475 for 2011/12. This was the first step towards a long-term objective of a 10,000 personal allowance.

Taken on its own, this would have meant you can enjoy an extra 1,000 of your income untaxed. However, the changes are aimed at the lower paid only, so higher earners will pay more tax at 40 per cent.

We won't know the exact changes until next month. However, the result is likely to be around an extra 2,000 of a higher-rate taxpayer's income being taxed at 40 per cent.

If you earn between 43,875 and 112,950 I would not expect your tax position to change. For those on lower incomes, government figures suggest that 23 million basic rate taxpayers will see a maximum cash saving of 170 and 880,000 of the lowest-income taxpayers will be taken out of tax altogether.