The UK is a generous nation, with data from the World Population Review ranking it as the third-most charitable country in Europe in 2025.

Indeed, research reported by Policy Bee reveals that in 2023/24, the total income of charities registered in the UK was £96 billion (up from £88 billion in 2022/23), and as of January 2025, this figure stands at over £100 billion.

When it comes to attracting donor support, small charities are often overshadowed by larger, better-known organisations. While there’s absolutely value in giving to major charities – many of which deliver truly transformative work – supporting smaller, local causes can offer unique benefits.

So, with Small Charity Week falling between 23 and 30 June, read on to find out about some of the emotional, social, and financial benefits of supporting a small, local charity.

Smaller charities can offer a more direct impact

Established, big-name charities often carry significant overheads compared to smaller organisations. Of course, this is just a natural part of operating at scale, as large charities need staffing, marketing, and infrastructure to generate the funds that support their work.

For example, Cancer Research UK spent £692 million in the 2023/24 financial year, with £133 million allocated to generating funds, which includes marketing and fundraising efforts. Again, this isn’t a criticism, as Cancer Research carries out life-changing work for millions of people. Rather, it highlights the significant overheads that are often necessary for running a large organisation.

By contrast, smaller charities often operate quite differently. Many lack dedicated marketing teams and instead rely heavily on volunteers to raise awareness, deliver services, and manage day-to-day operations. As such, donations to smaller charities may have a more immediate and visible impact, as a higher proportion of each pound often goes directly toward delivering services.

By supporting local causes, you may see the social benefits of your donation

When you support a small, local cause, you may witness or even experience the direct impact of your donation. This can bring a deep sense of satisfaction, knowing that your contribution is helping to bring about tangible change in your own community.

For example, there may be a local charity working to restore or maintain a historic building or cathedral. Preserving such spaces can enhance the beauty and character of the area, provide a venue for community events, and even attract visitors who support the local economy.

Or they might be a community fund that provides essential support to local disadvantaged children or homeless people. Knowing that your donation is helping people in your neighbourhood gain opportunities or support they might otherwise go without can be incredibly rewarding.

As such, supporting small charities not only helps those in need but can also strengthen your sense of connection to the place you live. It’s a reminder that meaningful change doesn’t always start on a grand scale and can sometimes begin right at your doorstep.

There can also be financial benefits of donating to charity

When you donate to any charity, small or large, there can also be financial benefits for both you and the organisation you’re supporting.

For instance, if you donate through Gift Aid, registered charities can claim an extra 25p for every £1 you give. And, if you’re a higher- or additional-rate taxpayer, you can also claim the difference between the highest rate of tax you pay and the basic rate of tax.

So, if you’re a higher-rate taxpayer, you can reclaim an extra 20%, and if you’re an additional-rate taxpayer, you can claim an extra 25%.

Moreover, if you leave at least 10% of your net estate to a charity in your will, the IHT rate on the rest decreases from 40% to 36%, which could provide a significant boost for your beneficiaries.

There may even be health benefits to supporting charities

Research from the University of Alabama suggests that charitable giving can boost happiness, reduce stress, enhance self-esteem, and strengthen social bonds. Acts of generosity activate the brain’s reward centres, generating positive emotions and a deeper sense of purpose.

The report highlights that such behaviours are not only linked to improved mental wellbeing but also to physical health benefits, such as lower blood pressure, a stronger immune system, and even a longer lifespan. Volunteering, in particular, has been associated with increased longevity and greater overall life satisfaction.

Get in touch

By giving back to your local community, you can help others, boost your finances, and improve your health as well.

To find out how you can make the most of your donation and structure it to support your wider financial plan, get in touch.

Email info@blueskyifas.co.uk or call us on 01189 876655.

Please note

This article is for general information only and does not constitute advice. The information is aimed at retail clients only.

All information is correct at the time of writing and is subject to change in the future.

Please do not act based on anything you might read in this article. All contents are based on our understanding of HMRC legislation, which is subject to change.