Charity Gifts in Wills: How and Why

Leaving a gift to charity in your will is a wonderful way to support causes you care about and create a lasting legacy. It can also reduce the inheritance tax bill on your estate.

Why leave a gift to charity?

There are many reasons people choose to include charities in their wills:

• Support a cause you care about: Whether it's medical research, animal welfare, environmental protection, or local community projects
• Create a lasting legacy: Your gift will continue to do good long after you're gone
• Say thank you: Many people leave gifts to charities that have helped them or their loved ones
• Tax efficiency: Charitable gifts are exempt from inheritance tax and can reduce the rate on the rest of your estate

The inheritance tax benefit

There are two tax advantages to charitable giving:

1. Gifts are tax-exempt

Any gift you leave to a registered charity is completely exempt from inheritance tax. If you're leaving money to charity anyway, it makes sense to do it through your will.

2. The 10% rule

If you leave at least 10% of your "net estate" to charity, the inheritance tax rate on the rest of your estate drops from 40% to 36%. This can make charitable giving effectively "free" - your beneficiaries might receive the same amount while charities also benefit.

Example: On a £500,000 taxable estate, leaving £50,000 to charity could save £20,000 in tax, meaning your family gets the same amount they would have received anyway.

Types of charitable gift

Pecuniary legacy

A fixed sum of money, such as "£5,000 to Cancer Research UK". Simple and certain, but inflation may erode its value over time.

Residuary gift

A share of what's left after debts, expenses, and other gifts have been paid - such as "10% of my residuary estate to the RSPCA". This keeps pace with the value of your estate.

Specific gift

A particular item, such as "my collection of books to the local library". Make sure the charity can use what you're leaving them.

How to leave a charitable gift

Simply include the charity as a beneficiary in your will. You'll need:

• The charity's full legal name (not just how they're commonly known)
• Their registered charity number
• A description of what you're leaving them

Our will-writing service makes it easy to include charitable gifts.

Things to consider

• Make sure your family is adequately provided for first
• Choose charities you genuinely care about
• Consider whether to leave specific amounts or percentages
• Check the charity's registered name and number
• Consider what happens if the charity no longer exists