O2 UK has given an insight into the costs payable by charities that receive donations by text message. From this month it’s cutting its charges for charities that receive donations by text message via its dedicated ‘70’ prefixed short codes. This follows the ruling that VAT is not payable on charity donations made via text message.
As a result, charities that receive donations of up to £10 via texts to O2 will receive 90% of the donation; around 10% more than previously. However, things aren’t quite that simple because those charities will also need to pay an ‘aggregator’ to set up the text message service and arrange connection to the mobile networks. O2 says its 10% charge covers network costs, VAT on the cost of the text message, insurance against bad debt and third party costs. [O2 blog]