Beneficial Trust & Will Co are pleased to announce that we are now proud supporters of Remember a Charity, a consortium of over 140 charities formed in 2000 in order to raise awareness of the importance of legacies to charities.

Remember a Charity is working to encourage more people to consider leaving a gift to charities in their will after they’ve looked after their family and loved ones. 74% of the UK population support charities and, when asked, 35% of people say they’d happily leave a gift in their will. The problem is, only 7% actually do. If we can raise this figure to just 11% it would create an additional £1 billion for charities in the UK every which would ensure their vital work lives on.

The consortium has the backing of key bodies in the Will making sector such as the Society of Trust & Estate Practitioners (STEP) and the Institute of Professional Willwriters (IPW).

IHT Position

Since 6 April 2013, where an estate includes a qualifying charitable legacy of more than 10% of the net estate, the taxable estate will only be liable to pay IHT at 36% rather than 40%

The ‘net estate’ for this purpose is the value of the estate after taking into account any IHT exemptions, the available nil-rate band and IHT relief. However, it does include the value of the charitable legacy itself.

The 4% IHT reduction can also apply to other assets on which IHT is payable. Effectively the availability of the reduced rate to the estate is calculated by considering the following;

  1. Trust Assets
  2. Joint Assets
  3. Other estate assets

The reduced rate can be applied to any 1-3 above. Alternatively 1-3 can be considered together and the reduced rate applied across all components, provided that the charitable legacy is at least 10% of their combined value.

As you would expect, the calculations to be made are complex and HMRC’s website contains detailed worked examples:

Support your client to Remember a Charity in your will………………….and help the work live on.