Will drafting—gifts to charities
Will drafting—gifts to charities

The following Wills & Probate practice note provides comprehensive and up to date legal information covering:

  • Will drafting—gifts to charities
  • Preliminary investigations
  • The gift
  • Residuary gift
  • Pecuniary legacy
  • Specific gifts
  • Reduced rate of IHT when 10% of net estate left to charity
  • Further considerations
  • Charitable Will trusts

Will drafting—gifts to charities

There are many reasons why a testator would wish to leave part of their estate to charity. Some may be purely altruistic but it is not uncommon for a testator to use such a gift as a means of extracting goodwill in their lifetime from their relatives.

Whatever the reason, charities have a number of tax advantages over non-charitable institutions. In particular, with their general exemption from inheritance tax (see section 23 of the Inheritance Tax Act 1984 (ITA 1984)) they are an effective tax-planning strategy. The exemption appears to only apply to charities established in the UK and these will be registered in the central register of charities kept by the Charities Commission. Not all charities are necessarily exempt and it is necessary to check for HMRC's treatment of them in the Inheritance Tax Manual at IHTM11101.

Preliminary investigations

Testators are often concerned to see that local charities or local branches of national charities are catered for. In respect of both these it is important to obtain details from the central register. If a local branch is not separately registered, which is likely, the gift must make it clear that it is for the use of that local branch.

There is a requirement for charities to submit their accounts and while it is not always essential to check those accounts, there is a point

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