It’s Remember a Charity week this week. That won’t mean much to many people so we’ll explain the role of wills in charity work and the benefits you can get from leaving some of your estate to charity.
Many charities rely heavily on gifts being left to them in a will and charities here in the UK estimate that they receive income of nearly £2.5 billion each and every year.
But many people either don’t get round to making a will (research suggests that 70% of adults in the UK don't have a will) during their lifetime or they don’t actually leave a charity any money in their will, even if they have made one.
A recent survey showed that 35% of people who were questioned intended to leave money to a charity that was close to their heart in their will. But the reality is that just over 6% of people actually do. This shows a real disconnect.
Benefits for you
So what benefits do you get if you do leave a charitable legacy in your will? First and foremost, there may be an inheritance tax benefit to making a charitable donation in your will.
The government is keen to encourage people to leave money to charity when they die so if inheritance tax to pay on an estate, the inheritance tax rate is reduced from 40% to 36% if you leave 10% of your estate to charity. This can result in a significant saving for your family.
Families saved £28 million in inheritance tax liabilities using this tax reduction for charitable donations in wills in 2013-2014, so it is well worth considering this. In addition, there is a 100% exemption from inheritance tax for all charitable donations made throughout your lifetime or on your death.
Alongside the potential financial benefits for your family, there are the thoughts of a continuing legacy after you die.
If there is a cause that is close to your heart, you know that their valuable work can continue long after you’ve gone and they can use the donation you’ve made to do this. Leaving something good behind is a great way for your memory to live on and can be a great way for your family to remember you.
How to do it
If you’re planning on making a will, just tell your lawyer exactly who you want to leave the money to. It is important to remember to look up their registered charity number, their full name and their address. This will make sure that all the details listed in your will are correct.
If you already have a will, make sure that when you update it, that you include all the information about the charity you would like to leave some money to.
It really is as simple as that.
Leaving a donation to a charity in your will can and will make a difference. Do it today.
Call us now
If you would like to make a will and include a charitable donation, please contact our experienced Tax and Estate Planning team on 0117 926 4121 or make a Free Online Enquiry.