Gifting to charity in your Will – options, considerations and action…

Making a Will is the best way to ensure that your family, dependants and any other loved ones will be provided for.  It is also an opportunity for you to consider making a charitable gift in support of one or maybe more causes that have meant something to you in your lifetime.  Such a gift needn’t be of a large amount, since whatever you are able to give will help the chosen charity to continue its work.

What are your options?  

You can support a charity financially by making a gift of a specific amount of money (e.g. £500), called a “pecuniary legacy”.

Another option is to leave a share of your residuary estate (a “residual legacy”).  So, for example, you could leave a 5% share of your estate (after the payment of any other legacies, debts and taxes have been settled) to your chosen charitable concern.

Alternatively, you could leave a specific asset, such as land or property, an object (such a work of art) or a bank account to the charity.

What should I consider?

First and foremost, it is important to consider how much of your estate should be gifted to charity.  If you intend to leave a fixed amount, you need to consider how much this should be and whether, after it has been paid, your residual beneficiaries are still likely to receive the proportion of your estate that you originally intended to leave them.

If Inheritance Tax (“IHT”) is a concern, it worth remembering that that part of your estate that you leave to charity will be exempt from IHT.  It is therefore possible to “configure” your estate in such a way as to ensure that no IHT is paid at all.  Alternatively, and subject to certain rules being met, if you give 10% of your taxable estate to charity, the remaining 90% will be taxed at only 36% – as opposed to the usual figure of 40%.

Some charities prefer to receive gifts that will help grow their own collections of art.   If you have antiques, papers or artwork that you would like to gift to a charity, it makes sense to contact the intended recipient charity first before making provision for them in your Will.

Some Charities have acquisition policies that determine what gifts they can accept.  Furthermore, a charity may not be able to meet the conditions that you may want to attach to a particular gift.  A solicitor of this firm recently advised on an estate where the deceased’s personal art collection, worth over £500,000, was donated to a charitable organisation that could not meet the deceased’s requirement for certain items to be displayed in a certain way.  Because of this, the Charity (with a very heavy heart) could not accept the gift.

Action 

If you are planning to give to charity in your Will, it is a good idea to get the correct charity number and current address of charity so that these can be included in your Will.  Some charities have more than one charity number, and some charities recommend a specific form of wording for the Will to help ensure they can make the best use of your gift.

If you intend to leave particular works of art to a charity then, for the reasons given above, it makes sense to get in touch with the charity to ensure that they can accommodate your gift.

And finally..

Get in touch with us and make your Will!

If you would like more advice about gifting to Charity in your Will and Inheritance Tax Mitigation options generally, please contact Thomas Evans, Associate Solicitor, on 01905 730 458 or at tevans@thursfields.co.uk.