Payroll giving is a scheme in which employees donate to nonprofits directly from their salary, usually before tax, making regular giving simple and tax-efficient.
Because contributions are recurring and automated, payroll giving provides nonprofits with predictable income and gives the company clear, auditable records of employee generosity.
Payroll giving is a mechanism that lets employees donate to charity directly from their salary, as a recurring deduction from each paycheck. In some countries the donation is taken before income tax, increasing its value to the charity.
Payroll giving is one specific mechanism, donating via paycheck deductions, within the broader category of employee giving. Employee giving also includes matching gifts and volunteer grants. Payroll giving is a way of giving; employee giving is the whole category.
Because it is recurring and automatic, employees set it once and it continues, giving charities a predictable income stream and achieving high participation. Its convenience is why it often sees the strongest engagement of any giving method.
In some jurisdictions, donations are deducted from pre-tax income, so the gift costs the employee less than its full value while the charity receives the whole amount. The exact tax treatment depends on the country's rules.
The newest terms we've added, the words teams managing grants, sponsorship, and CSR come across most often.
Restricted funds are donations a donor has earmarked for a specific purpose, project or time period, which the recipient may use only as designated.
Distinguishing restricted from unrestricted funds is fundamental to compliant accounting and reporting, since misusing earmarked money breaches the donor's terms.
A pledge is a donor's formal commitment to give a specified amount, sometimes over several years, before the funds are actually transferred.
Tracking pledges against payments received is essential for accurate forecasting and reporting, so an organisation knows both what has been promised and what has arrived.
A gift acceptance policy sets out which donations an organisation will and will not accept, and under what conditions, covering issues such as donor due diligence, restricted gifts and reputational risk.
A clear policy protects the organisation from problematic funding and gives staff a consistent basis for evaluating and recording every gift.
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