The most popular tax-efficient way to conduct your philanthropy.
A donor-advised fund (DAF) is a simple, flexible and tax-efficient way to manage your charitable giving. It’s an account set up under the umbrella of a registered charity—known as the sponsoring organisation—which looks after all the administration and governance on your behalf.
With a DAF, you can make a donation, receive immediate UK tax relief, and then take your time deciding which charities to support. You can add to your fund as often as you like and recommend grants to your chosen charitable organisations whenever it suits you.
It’s an easy and effective way to plan your philanthropy, with all the benefits of having your own charitable trust but without the administrative burden.
Get a Snapshot
How People Use DAFs to Fuel Their Philanthropy
£ 645.4 M
in grants from DAFs in 2023
£ 2.8 B
charitable assets in DAFs in 2023
26 %
annual payout rate as of 2023
6 %
of all charitable contributions made to DAFs in 2023
Get a Snapshot
How People Use DAFs to Fuel Their Philanthropy
All statistics are as of 2023, sourced from the 2024 UK Donor-Advised Fund Report.
How Donor-Advised Funds Work
Donors Contribute
The donor makes an irrevocable contribution to the donor-advised fund (DAF) and can take an immediate tax deduction. See what you can contribute in the Contributions tab of our FAQs.
Assets May Grow
The charitable assets in the DAF may be invested, and any investment growth is tax-free for the donor. Explore tax benefits.
Charities Benefit
The donor recommends grants from the DAF assets to support qualified charities. Read grant highlights.
History and Trends
The first donor-advised funds were created in the 1930s in the United States. They were formally recognized and regulated there in the national tax code following the US Tax Reform Act of 1969, but did not increase in popularity until the 1990s. Today, they are philanthropy’s fastest-growing vehicles.
For a detailed look at donor-advised fund trends, you can view our most recent Donor-Advised Fund Report.
Benefits of a Donor-Advised Fund
DAFs have become popular in part because of their versatility, allowing donors to give when, what, how, and where is most favourable for them. There are many reasons why individuals and families choose a DAF as their preferred giving vehicle. Charitable giving through a DAF can also be a tax-efficient way to build a lasting philanthropic legacy.
Here are the benefits of a donor-advised fund:
- Receive eligible UK tax reliefs on your contributions
- Contribute immediately, build a philanthropic strategy and grant when you’re ready
- Grow your contributions over time, increasing the funds available for future grants
- Simplify administration
- Create a charitable legacy
- Choose how you are acknowledged
- Develop a philanthropic vision and philosophy
- Reach grants to UK or international charities that align with your philanthropic aims
DAFs vs. Charitable Trusts
DAFs and charitable trusts share a common goal, and both are designed to support long-term philanthropic giving. However, each structure offers different features, benefits, and administrative requirements.
At NPT UK, we can assist you in converting an existing charitable trust into a DAF account, offering lower administrative overhead and greater flexibility in making grants. The trustees or administrators of your charitable trust can continue to act as financial advisers and successors to the DAF account in perpetuity.
Alternatively, you may choose to open a DAF to complement your existing charitable trust, helping you to enhance your philanthropic strategy and potentially maximise available tax benefits while continuing to achieve your charitable objectives.
How to Get Started
To establish your donor-advised fund (DAF), you make an irrevocable contribution of personal assets—which can include cash, shares, or even more complex or illiquid assets. Your contribution is treated as a charitable donation to NPT UK, and the balance is then reflected in your individual DAF account.
At NPT UK, we accept one of the widest ranges of assets of any DAF provider, helping you turn almost any asset into philanthropic capital that can be granted to the causes you care about most.
When you contribute to your DAF, you may be eligible to receive UK tax relief available for your type of asset. This flexible approach allows you to plan your giving strategically—taking the tax benefit when it best suits your circumstances, while recommending grants to your preferred charitable organisations at any time in the future.
Learn more about donor-advised fund tax benefits.
When you establish your DAF, you have the flexibility to structure it around your personal charitable goals. You can name your DAF however you wish—for example, after your family, a cause, or anonymously. You can appoint family members, friends, or trusted advisers to join you in managing the fund’s charitable giving.
You can also create a Succession Plan to outline how your DAF assets will be used beyond your lifetime, whether by appointing successors to continue your philanthropic vision or naming charitable beneficiaries to receive the remaining balance.
You can recommend an investment strategy for the assets in your DAF by choosing from a range of pre-approved investment options. Your DAF assets are then invested in line with your recommendations.
Any investment growth is tax-free, allowing your charitable capital to grow over time—and giving you the potential to make an even greater impact through your future grantmaking.
Once your DAF is established and funded, you can begin recommending grants to the charitable organisations closest to your heart. Our team carries out thorough due diligence on every grant recommendation to ensure your funds are used solely for charitable purposes.
You can choose to make one-off or recurring grants, and decide whether to give with recognition or complete anonymity—whichever best suits your philanthropic goals.
About NPT UK
We make it easier for you to achieve your philanthropic goals.
NPT UK provides donor-advised funds (DAFs) to donors in the UK and those around the world who wish to base their philanthropy from the UK. We are an independent charity driven by our mission to make philanthropy more convenient and efficient for donors. We offer giving vehicles and expertise to philanthropists, family offices, and wealth managers from one of the world’s leading financial centres.
The NPT group also includes NPT Transatlantic, a US/UK dual qualified charity providing DAFs that enable dual taxpayers to benefit from tax relief in both the UK and the US.
Do More with Donor-Advised Funds
Create Multi-Year Commitments to Your Favourite Charities.
Donors can use their DAFs to support their favourite charities—once, or for years to come. DAFs allow donors to use specialised grant agreements, recurring grants and anonymous grants to help reach their charitable giving goals.
Build a philanthropic strategy
Streamline Global Giving.
Your clients can give to qualified charities anywhere in the world with an NPT UK DAF, and they can have peace of mind for regulatory compliance. NPT UK has expertise in cross-border giving, conducting due diligence on a wide variety of organisations and ensuring compliance with UK charitable law—thus reducing the administrative burden on donors.
Read about global giving strategies
Convert Illiquid Assets into Philanthropic Capital.
DAFs can accept a broad variety of assets as contributions, including illiquid assets such as works of art and other tangible personal property. In recent years, donating illiquid assets to DAFs has become increasingly popular as donors look beyond their investment portfolios and consider their total wealth as potential gifts to charity.
Learn about contributing alternative assets
Grant Highlights
Donors use DAFs to support charitable work around the world.
Keep Exploring
Additional Resources
The Great Wealth Transfer: The Rise of Next-Gen Donors
Learn More
Family Philanthropy: Creating a Lasting Giving Tradition
Learn More
DAF 101: What is a DAF and How Does It Work?
Learn More