The survey was conducted by the Charities Aid Foundation, who asked 120 senior charity executives

Chancellor George Osborne said that from 2013 there would be a £50,000 cap on tax relief, or 25% of income – whichever is higher.

During last month's Budget Chancellor George Osborne said, from 2013, there would be a £50,000 cap on tax relief - or 25% of income if that was higher. The Charities Aid Foundation (CAF) questioned 120 charity senior executives.

The survey suggests that 88% of those questioned believed the cap would have a "negative impact on the value of donations" from major donors, while 56% believed donations would fall by 20%.

The CAF’s John Low said: "This survey shows the widespread alarm and despair among charities at the government's decision to cap tax relief on donations.

"There are fears across the charity world that donations will be hit, which means the vital work that charities do will be damaged at a time when demand is high and public spending cuts make the charity safety net even more important," he added.

He said he had no doubt there were people who were using a range of tax allowances to reduce their own tax returns to low figures.

But ultimately, says Low, it will not be the wealthy that are worst hit by this, but the most vulnerable who rely on charity work.

Marcelle Speller, who set up the website localgiving.com, told BBC Radio 4; "If you want to encourage people to help the communities and help society and do Big Society then you must give them incentives to do so."

"With a reduced tax relief, you have a limited amount of money that you can give to philanthropy - we're not all bottomless pits. There's an amount that you decide to give of your budget for philanthropy and a significantly less amount of that will go to the charities," she said.

Despite pressure on the government to rethink their plans for tax relief limitation, the Treasury have said that the rich should pay their “fair share”.