AN extra £1.4bn could be raised for charity each year if more firms offered their staff the chance to donate money through their payroll, research showed today.

About 42% of workers said they would be likely to donate to charity using payroll giving if their company offered the scheme, according to the Charities Aid Foundation (CAF) and the Royal Bank of Scotland Group.

Payroll giving enables people to donate money to charity tax-free, direct from their pay, but only half of the working population is actually aware of the scheme.

The research also found eight out of 10 people thought it important for companies to encourage staff to give to charity.

One in five even said they would be more likely to choose an employer that offered payroll giving than one that did not.

Stephen Ainger, chief executive of CAF, said: "The research shows that £95m is currently given through the payroll.

"This is an excellent figure, but it is generated by only 2% of all taxpayers.

"If those questioned who said they would give through their payroll actually did so, this would generate £1.4bn more for charities every year."

ICM Research questioned 1,000 people in June.