How Do I Leave Money To Charity In My Will?

Remembering a charity in your Will

Most charities are highly dependent on gifts in Wills, be it a set monetary sum, or a share or all of the residuary estate.

When you make a Will with us, we’ll ask if you want to leave anything to charity. The Law Society recommends that we do this. It is not our intention to make you feel guilty or to pressurise you into gifting to a charity – the option is entirely yours.

For some, it reminds them that it is not necessary to leave everything to blood relatives. On the other hand, many of our clients say that they have made charitable provisions during their lifetime and decline the invitation to make further gifts.

Charitable gifts to reduce Inheritance Tax

If your estate is due to incur Inheritance Tax, then it is worth noting that the rate of Inheritance Tax can be reduced from 40% to a lower rate if a set proportion of the estate passes to registered charities. There is no Inheritance Tax charged on gifts to charity. The reduction of the rate of tax will apply to all beneficiaries in the estate and not just the charities.

How to make a charitable gift in your Will

If you want to make a charitable gift in your Will, then there are certain steps you need to take.

Firstly, consideration should be given as to whether the gift will actually benefit the charity. We are aware of some charities receiving stuffed birds, fire arms, fishing rods and timeshares on holiday flats. Charities do not have to accept a gift that could incur costs, such as service charges on flats.

Secondly, it is important to correctly identify the charity. The best way to do this is to visit the Charities Commission website. A search of the Charity Register will confirm the correct name and registered number of that charity. These details should be included in your Will. Many gifts fail because the charity is not correctly identified. There is no such charity as Cancer Research or Cancer Research Nurses. Many charities have information on their websites as to how to donate and how to identify them in a Will.

Thirdly, it is possible that the charity will have amalgamated or ceased to exist by the time of your death. Wills should be written to cater for this eventuality, with an ultimate backstop that if the charity does not exist, your Executors and Trustees can find a suitable charity that matches your charitable intent. So, for example, if you are favouring an animal charity, they can look for another one that benefits animals.

Advice for Executors

Wills are public information and charities read Wills that have been registered, following an application for a Grant of Representation, to see whether they have been named. They will wait to see if the Executors contact them, but otherwise they will write to those Executors to show that they are aware of the gift.

Charities are businesses and they will wish to approve the estate accounts. If a charity is due to receive a substantial sum and that substantial sum is not shown in the estate accounts, it will make further enquiries. Questions will be raised as to the pattern of lifetime gifting which has reduced the size of the estate, or as to the location of missing family heirlooms.

Where everything is left to charities

Where everything the deceased owned has been left to a charity, that charity will consider requests for personal and sentimental items to be released to family. Where the item has a low value, this can be done on an ex-gratia basis. But if it is a higher value, then an application will have to be made to the Charities Commission for approval.

Speak to our Wills Solicitors

At Aticus Law, we can help you with the wording or your legacies, discuss the suitability of the gift, and advise on the use of charitable donations to reduce Inheritance Tax.