A new study has found that charitable donations in Wills increased significantly throughout the Covid-19 pandemic.
According Co-op Legal Services which authored the report, more people than ever are using charitable bequests within their Wills – in part to benefit from Inheritance Tax (IHT) relief.
The study revealed that charitable donations left in Wills increased by 61 per cent in the year to December 2020, compared to the previous 12 months. The data also shows that around a third of all Wills now include a gift to charity.
The report suggested that by raising awareness of the tax benefits of leaving money to charity could lead to a further increase in annual legacy revenue.
Under current Treasury rules, all gifts left to charity are tax-free and are not counted as part of the overall value of your estate.
Additionally, if more than 10 per cent of an estate is left to charity, the IHT rate on the portion of an estate above the IHT threshold is reduced from 40 to 36 per cent.
Rob Cope, Director of Remember A Charity, said: “Family and friends will usually be people’s first consideration in a Will. But leaving a charitable bequest is something that many people find incredibly empowering – a statement about who they are and what they believe in – and a wonderful way to shape the world they leave behind. It’s great to see how much appetite there is for giving in this way.
“Legacy income has been vital for charities, particularly over the past year when events and retail were so badly hit.”
For help and advice on IHT rules and charitable giving, please get in touch with our team.