This tax relief on charity donations will take effect from April 1st, 2026. Currently, businesses are required to pay VAT when donating items or giving gifts to charities for free. Although, donated resale goods are zero-rated.

According to Boop, 10% of products in beauty’s supply chain ends up being wasted. A 2024 report found that overproduction accounts for 6.2% of this waste and 4% comes from products disposed of due to damage or reaching their expiry date.

Reducing this wastage will become simpler, and cheaper, under the new tax relief of charity donations. What’s more, it will increase supply for charities while reducing costs, waste, and administrative workload with the HMRC on the business side.

There are many organisations offering solutions to surplus stock in the beauty industry – these include Beauty Banks, The Hygiene Bank, and In Kind Direct. These charities handle all logistics from collection to distribution, ensuring products reach foodbanks, schools, refuges, and community groups to provide real impact.

Donating is a simple way for businesses to act more sustainably, reducing our sector’s impact on the environment. The Sustainable Beauty Coalition is spotlighting this waste prevention strategy as part of the Great British Beauty Clean Up campaign.

The initiative, which is dedicated to increasing recycling and cutting waste, is urging brands to donate usable products, such as those made at surplus, with slight imperfections, or those from discontinued lines, preventing them from ending up in landfill.

Thanks to the new tax relief on charity donations – this couldn’t be easier.

If you would like to find out more about the tax relief on charity donations, click here.