The main priority for many who leave a will is to provide security for their families. And rightly so. However, writing your will is also a great opportunity to support charitable causes close to your heart. Here Will Aid campaign director Peter de Vena Franks looks at the benefits of leaving a charitable legacy.
Money left in a will to charity, or a 'charitable legacy' is a really important source of charity funding. Whilst bills and unexpected costs can get in the way of donating to charity while you're alive, leaving a legacy to charity is a great way to make your mark.
The reasons why people leave charitable legacies vary. You might have a charity you have donated to or volunteered for, a friend or family member might have been helped by an organisation, or maybe you have been emotively affected by seeing the work of charities on the news. Whatever the reason, a charity can have a resonating effect on an individual.
Every penny counts
Of course, when it comes to your will, family and friends come first. But as one of our charity partners, NSPCC say: “After you've taken care of your loved ones, a small percentage of whatever's left could help us make sure that every child has the safe childhood they deserve.”
Charitable legacies represent a major source of funding for a great range of charities. Indeed, the average legacy gift left to Save the Children is enough to buy a generator to provide 15,000 people with water.
A win-win situation?
In some circumstances, leaving a set sum of money or a share of your estate to a charity can have financial benefits for your other beneficiaries.
The current inheritance tax threshold is £325,000 per person (£650,000 per married couple) meaning that if your estate exceeds this figure the excess is very likely to be taxed at 40%.
Any property that passes to your spouse or to charity usually passes tax-free.
If you have left 10% or more of your taxable estate to charity, the inheritance tax charge on the rest of your estate is reduced to 36%.
This can mean, in certain situations, that if you increase what you plan to leave to charities, your beneficiaries actually receive more.
A solicitor can advise you on the most tax efficient way to approach this.
The Will Aid gift
If you do not want to leave a money to charity in your will but like the idea, you can still support those in need by creating a will through Will Aid.
During the month of November, a number of solicitors will be offering their time and skills to draft basic wills asking for a donation instead of their usual fee.
All money collected will be split between nine of the UK’s most loved charities.
Find participating solicitors near you by clicking here.