Donor-Advised Fund (DAF) accounts with KindLink

At a Glance

Donor Advised Funds (DAFs) simplify charitable giving by letting individuals and businesses donate through KindLink Foundation without added administrative burdens. Charities benefit from verified, fee-light donations, wider donor access, and reduced administration, while donors gain tax efficiency, flexibility, and transparency with direct impact reporting.

Donor Advised Funds (DAF) in the UK

As a charity manager, you are responsible for everything, from finding volunteers to managing charity finances and handling legal and operational compliance. You are probably wishing that there were more hours in a day! 

While at KindLink, we can’t extend the hours, but we can certainly make sure some of the workload is streamlined. Our CRM helps automate Gift Aid claims, find volunteers and create customised fundraising pages. 

At KindLink, we also help both businesses and charities with donor-advised funds in the UK. As a non-profit organisation, when you receive DAF charity funds, you can reduce the administrative burden associated with fundraising, although standard compliance still applies. This allows you to spend your time towards helping people (or animals and the environment), rather than being bogged down by operational headaches.

This guide explores how donor-advised funds work with KindLink and the many benefits they offer charities. 

What is a Donor-Advised Fund in the UK?

Traditionally, when an organisation or individual wants to donate, they first decide on the charity and then allocate funds. However, it’s the many benefits, such as immediate tax benefits, flexibility, ease of usage and anonymity, that have made DAF extremely popular.

A Donor-Advised Fund in the UK, or DAF, is a philanthropic giving vehicle hosted by a registered charity (KindLink Foundation). It allows individuals or organisations (DAF account holders) to establish a foundation account and instruct donations without having to register a charity themselves. This scheme can save cost and time, while it is much more flexible and easier to manage.

Usually, the fund is created with an initial donation by the individual or the organisation and can be topped up with additional income or fundraising activities (via the KindLink Fundraising Platform). 

All donations are irrevocable and become an asset of the KindLink Foundation, while the DAF account holder can advise to which non-profit cause the money should go. Due diligence of the beneficiary organisation lies with KindLink Foundation as the DAF charity provider, so the donors are confident that the funds are transferred to a credible organisation, saving them time and ensuring that the funds have the desired impact.

Benefits of DAF for Charities

The benefits of using donor-advised funds in the UK for organisations and patrons are easily understood; many non-profits are often on the fence about whether DAF is right for them. 

We’ll look into the advantages of being a DAF charity:

Receive More Donations 

Donors often prefer convenience over confusion. Whether an organisation or an individual, patrons are often unsure on which charity or cause to support. 

With thousands of non-profits looking for assistance (and with fake ones that look to siphon funds without helping those in need), due diligence is important. 

For many donors, this is a challenge, but with DAF, this headache can be bypassed. 

A DAF charity account makes it easier to donate and allows support for multiple charities. Ease of donating can compel donors to contribute more. 

Verified Donations

Just like how donors don’t want to get involved with sketchy non-profits, charities, too, prefer donations from legal and legitimate sources. 

When you receive funds through KindLink Foundation, there is no risk involved. We undertake due diligence, reducing the risk of financial or reputational damage. 

No Administrative Burden

Fundraising is more complicated than the public perceives it to be. There is paperwork and legal compliance that needs to be followed, which can pose a challenge for resource-strapped small or medium-scale charities. 

With DAF, you receive the funds without the operational headache, allowing you to concentrate more on the work.

No Hidden Fees

Charities need every penny that comes their way. At KindLink, we do not levy any charges for receiving DAF charity donations. Better yet, you can register and use our CRM for free or opt for our budget-friendly plan, making it accessible for younger and smaller non-profits. 

Also, charities that receive funds through DAF often have long-term support. If you run a non-profit, you would know how beneficial it is to have continuous support rather than constantly looking for new donors. 

Wider Donor Pool

While bigger non-profits like the Red Cross, UNICEF or WWE often have connections with the top MNCs and corporations, the smaller philanthropic societies struggle. A donor-advised fund in the UK allows charities to target both individuals and businesses for fundraising. 

How Donor Advised Funds Work for Charities

Now that you’re aware of the advantages of receiving funds through DAF, let’s look at how Donor Advised Funds work for charities:

Step 1:  A donor opens a DAF charity account with a provider, such as KindLink Foundation, and they donate money to the account. 

Step 2: The donor recommends a charity. 

Step 3: The DAF provider will undertake due diligence about the charity, check registration, credibility and eligibility to receive funds. If approved, you will receive the funds directly into your account. 

Step 4: Unless the donor has chosen to remain anonymous, you can showcase your gratitude by posting the impact and funding story on your websites, socials and even on the KindLink platform.

The KindLink DAF Proposition & Costs

In 2022, Donor Advised Funds in the UK for charitable purposes reached £868.5 million ($1.099 billion). This remains a niche market, only available to the richest in the world. By adapting our KindLink for Business platform to DAFs, we have launched a new concept that allows more donors to set up and manage their own DAFs and contribute to the causes they want.

KindLink helps companies with the ability to manage their Charitable Funds or foundations’ grant process simply and cost-effectively by utilising DAFs. Working with the KindLink Foundation (a registered charity No 1177210) allows us to reduce the administrative workload and cost of managing community funds for our corporate partners.

Some providers of DAF accounts charge high fees (between 4 and 5%) to manage the fund, plus additional setup and maintenance fees. Here at KindLink, we aim to make charitable giving as accessible as possible by keeping  the cost to 1-2% with no additional hidden fees. The fees are not used for commercial purposes but only to support KindLink Foundation in running the service.

The KindLink technology brings DAF management and reporting to a new level, allowing the donors to govern their funds online and receive direct impact updates from the organisations they support. This allows donors to build a closer bond and establish a “Kind Link” with the organisations they support, seeing the impact they are making on the world.

Use KindLink’s CRM to Raise Funds

KindLink makes it easy for charities to raise funds in a secure and compliant manner. Whether it’s receiving donations through Donor Advised Funds in the UK, claiming an additional 25% Gift Aid Claim from the HMRC for eligible donations or creating a custom fundraising page, it only takes a few clicks on our CRM. 

Our platform is GDPR compliant, and we employ stringent data and privacy security checks to ensure that both non-profit and donor data remain secure. 

If you are interested in finding out more or setting up a DAF account with us, please contact help@kindlink.com. Get ready to change the way charity administration and finances are done.