Save Tax When You Leave Your Legacy

Charities need our help more than ever before: Covid-19 lockdown and continuing social distancing rules have stopped many from raising vital funds.

So many charities are struggling now, their reserves fast running out. Legacies are the vital lifeline of thousands in many cases. So they need to survive in these you’ll be able to give more of what difficult times. remains in the estate to your loved Bequeathing money to a worthy ones and less to the taxman. But if cause close your heart is a you donated only 9% of your net wonderful act of generosity – estate to charity, this opportunity especially now. Your kindness will would be lost. be hugely appreciated by the And here’s the tricky bit. The value charity and its beneficiaries. of your estate will be changing as But it pays to take expert legal some of your assets (such as advice first. There are generous tax property and shares) rise or fall in benefits that will help your gift to value. go a long way (and potentially benefit your loved ones too). So you’ll need to be certain that Tax-Efficient Legacies remains at or above 10% of your Good news – any gift you make to net estate if you are to benefit from charity is free of Inheritance Tax the IHT reduction. (IHT). There’s no limit. You can How Much Will Be Left After donate as much as you like to Your Charity Legacy?charity and it won’t be subject to a the amount you leave to charity penny of IHT. Leaving money to charity is such an emotional decision that And if you donate 10% (or more) of sometimes it’s all too easy to forget your net estate to charity, the IHT the practicalities of the process.liability on what is left drops from If you leave a fixed sum to charity 40% to 36%. (or anyone else) in your Will, then That may not sound much of a the executors are legally bound to reduction but it can save you tens pay out that money first.

An increasing number of companies and organisations operate a match funding scheme whereby they ‘match’ charity fundraising undertaken by their employees. These businesses set aside money to fund such schemes and are more than happy to support their staff in raising money for charities of their choice. Everyone else sharing in the remainder of the estate would receive their bequests from what is left afterwards (unless they too have been apportioned fixed sums). So the value of what they receive can vary, depending on what remains in the estate. Charities need our help more than and continuing social distancing rules have stopped many from raising vital funds. What if the value of your estate has fallen dramatically since you made your will? What if your savings have been depleted by care home costs or a fall in the value of your investments? This is one reason why it pays to get expert legal advice when

ever before: Covid-19 lockdown

making or reviewing your Will.

Stuart Bradford

You need to be absolutely certain Forest Holme Hospice Charity that what’s left in the estate will Trustee, Partner and Head of the always be enough to help provide Probate Department at Coles Miller for your loved ones. Solicitors LLP