Insights

Leaving a Gift to a Charity in Your Will

Posted by: William Claydon | 5th September 2019

 

Today is International Charity Day. It is an opportunity to reflect and contribute to the incredible work that charities do around the world. Leaving a gift to a charity in your will is a great way to leave a legacy that benefits the most vulnerable in society. In addition, it benefits the beneficiaries of your will.

Alexis Thomas, a Chartered Legal Executive in CJCH’s Wills & Probate team, outlines the benefits of leaving a gift to a charity in your will, how to ensure the gift is not legally challenged and how to ensure the gift you leave is used in a way that aligns with your wishes.

Benefits of leaving a gift to a charity

Leaving a gift to a charity in your will is an excellent way of supporting a cause dear to you. Most charities will rely on donations to carry out their work so this is a great way of contributing to your charity’s long-term vitality. In addition, a gift in your will to a charity will not count towards the total value of the estate and the gift will pass tax-free. If the value of the gift is 10%, or more, of the total taxable estate, this gift will also reduce the amount of IHT payable from 40% to 36%.

The different types of gift you can leave

You can leave any type of gift to a charity. This ranges from a specific sum of money, items of personal value such as jewellery or even a % of your estate. You do not have to contact the charity in your lifetime, your executor will inform the charity that you have left them a gift in your will.

Specifying how the charity uses the gift

You can express in a wish how you expect the money to be used. However, the testator should discuss their wishes with the charity first, as the charity may refuse the gift if it cannot comply with the testator’s wishes. The wish is not binding, but charities will usually seek to carry out the specified request.

If your gift is challenged and how to avoid it

Firstly, always seek legal advice! This is so important. The courts place more weight on a moral obligation to a family, which outweighs any commitment to charities. If the gift is successfully challenged, then the gift could fail. Regular communication from the solicitor goes a long way in ensuring that this does not happen.

Donating outside of the UK

Donations outside of the UK are different than domestic donations. Exemptions from inheritance tax only apply to gifts to charities in the UK, EU member states (plus Norway, Lichtenstein, Iceland). Of course, this may change due to the uncertainty surrounding Brexit. Furthermore, donations outside of the UK do not benefit from Gift Aid as Gift Aid enables the charities to reclaim an extra 25% in tax on each donation made by a UK taxpayer.

How can a solicitor help you leave a gift to a charity in your will?

A solicitor ensures your Will is written correctly. This gives you the peace of mind the gift will succeed. The full details of the charity (charity number etc) are included so that the charity receives the gift. Incorrect information may cause the gift to fail.

How can we help:

It is never too late or too early to start thinking about your future. For more information on writing your will and leaving a gift to charity, speak to an experienced member of our team today.

Contact us:

Email: privateclients@cjch.co.uk

Telephone: 0333 231 6405