How to ensure money left in your will goes to the causes you care about10 Jun 2020 | Jan Atkinson
The coronavirus crisis has seen the public rally around the NHS which has benefitted from considerable fundraising efforts and donations in recent months. Research by the Charities Aid Foundation has shown that amongst those wanting to donate to charity in response to the crisis, 40% planned to donate to NHS charities and 34% to local charities.
As we consider how we can give back to those getting us through this crisis, Jan Atkinson, an estate planning solicitor at London law firm Osbornes Law explains why bequeathing money to charity in your will can actually increase what you leave behind.
“As the peak of the crisis passes, many of us are reflecting on what has happened, how it has shaped our priorities and how we can contribute to our wider community. Giving money to charity in your will is a great way to show support for those healthcare providers and local charities that have done so much throughout this crisis and to ensure they are able to continue to do so into the future, “ Jan explains.
“There are also inheritance tax advantages associated with charitable bequests, allowing you to increase the amount you are able to pass on. If you leave 10% or more of your estate to a UK registered charity, not only is the amount you give to charity free of inheritance tax, but the rate of tax on the rest of your estate is 36% instead of 40%.
“For example, if you leave an estate with liquid assets of £500,000, normally inheritance tax would be due at 40% on £175,000 of that, so your estate would have to pay £70,000 in inheritance tax. However, if you left 10% of that estate (£50,000) to charity, then the value of your chargeable assets would reduce by £50,000 and inheritance tax would be due on £125,000, but at a reduced rate of 36%. This means that your estate would only have to pay £45,000 inheritance tax.
“If you already plan to give at least 4% of your estate to charity, it’s worth considering increasing that gift to 10% so that the charity and your beneficiaries receive more.”
Jan warns it is important to let your family know of your plans in advance to avoid costly disputes arising from your will.
“When a parent unexpectedly donates a large proportion of their estate to charity without informing their family members, there is a danger they will contest the will, particularly where children were expecting a large inheritance or where estranged family members are cut out of a will in favour of a charity.
“The Inheritance Act 1975 means that if your will does not provide reasonable financial provision for any financially dependent family you may have, a family member or partner could contest a charitable gift to get the financial provision they feel they are entitled to. Fighting such actions can be hugely costly for the charity and the family.”
If you are giving to charity, it is likely you have put a lot of thought into where you would like your money to go so you will want to ensure your wishes are followed.
Jan says, “If you are giving to a large charity you may want to stipulate what your donation is to be used for. For instance, you might want to give to Cancer Research but would like your money to be used in research relating to a particular type of cancer. When making your will it is possible to stipulate that the bequest is contingent on the money being used for a specific purpose but it is worth checking with the charity first to make sure it will be possible to use the money in the way you wish.”
Share this article
Jan Atkinson Partner
Contact us today
For a free initial conversation call 020 7485 8811
Email us Send us an email and we’ll get back to you
More from JanVIEW ALL
How to prevent someone contesting a will
It is fairly rare in my experience for a parent to write a child out of their will but that...Read more
Gifting Property to Children
Can I gift property to my children? Gifting a property to your adult children is a relatively complex transaction but...Read more
Contentious Probate Case Studies
Contentious probate involving business assets Osbornes Law acts for the defendants to a claim issued to pronounce in favour of...Read more
Contesting A Will Case Studies
Will dispute on grounds of lack of capacity Our contesting a will solicitors acted for the claimants, the adult daughters...Read more
Funding of Probate disputes
Contentious Probate can be very expensive and clients often find it difficult to find the money to cover their legal...Read more
Worldwide Probate Dispute
The deceased died in Ireland leaving very considerable wealth and assets all over the world, including England, but without leaving...Read more
US/UK cross border probate
Our probate lawyers in London were instructed by a US-based widow of her late husband’s £8 million English estate. As...Read more
Dealing with Debts as an Executor
It is a common misconception that a person’s debts die with them. After you die your debts become the...Read more
What is reasonable financial provision in 1975 Act claims?
The long-running and high-profile case of Ilott v Mitson  UKSC 17 has finally come to an end with the decision of...Read more
Making a Will by video link
The Government has recently announced plans to allow for the witnessing of Wills and Codicils by video conferencing. This is...Read more
Plan your Estate ahead of the Autumn Budget
The issue of Inheritance Tax made the headlines recently after the Chancellor of the Exchequer was reported to consider raising...Read more
Left Out of A Will
I was left out of my mother’s last will and I am confident this was not her intention. What...Read more
Over the weekend the government announced plans to introduce legislation that will allow wills to be witnessed remotely via video. ...Read more
How do I avoid inheritance tax on my...
Transferring property to your children to avoid tax could backfire Gifting property to your children to avoid inheritance tax may...Read more
Probate Applications – the latest on turnaround times
Until around 18 months ago, the turnaround time for grant of probate applications could be as little as 5 to 7 days if...Read more
Jan Atkinson, senior partner writes on personal financial...
Our Head of Wills, Probate and Estate Management at Osbornes Law has contributed to a special Finance Supplement on ‘Dealing...Read more
Jan Atkinson, Head of Wills, Probate and Estate...
The Sunday Times newspaper article. 19th April 2020, headlined “More families going to war over wills” provided an insight on recent...Read more
New landmark set in the Time Provision for...
In the judgment of the case of Thakare v Bhusate  EWHC 52 (Ch) handed down recently, the High Court upheld a...Read more
Property abroad? Beware of forced heirship rules
Whether it’s a holiday home, an investment property or a place you want to retire to, if you own...Read more
Delayed Introduction of Guardianship Legislation
The Guardianship (Missing Persons) Act 2017 comes into force on 31 July 2019. This is a full 27 Months after the bill was given...Read more
What are the rules of intestacy? It is estimated that between half and two-thirds of the adult population have not...Read more
Treasury collecting millions when no will has been...
Finding beneficiaries for unclaimed assets The amount of unclaimed assets has nearly doubled in the last year, with the Prince...Read more
Cross Border Issues – Wills and Succession
An increasing number of individuals have connections with more than one jurisdiction. Conflicting rules can significantly affect their estate planning...Read more
Apply for Probate Online HM Courts and Tribunals Service has announced its expansion of the online probate application system, which...Read more