Including charities in your will is a noble and impactful decision that can leave a lasting reputation. When you choose to leave part of your belongings to a charitable organisation, you are making a significant contribution to causes that matter to you, ensuring your values continue to influence the world even after you are gone. This blog explores the process, benefits, and considerations of including charities in your will.
Understanding Charitable Bequests
A charitable bequest is a donation left to a charity through your will. This donation can take various forms, including:
- Monetary gifts: A specified sum of money.
- Residuary gifts: A portion of your estate left after all other gifts, debts, and expenses have been paid.
- Specific gifts: Particular items or assets such as property, stocks/shares, or personal possessions.
The Benefits of Including Charities in Your Will
Supporting Causes You Care About
Including charities in your will allows you to support the causes that you are passionate about. Whether it’s medical research, education, animal welfare, or environmental conservation, your gift can make a significant difference.
Tax Benefits
In the United Kingdom, charitable bequests are exempt from Inheritance Tax. This means that the value of your donation will not be included in the taxable value of your estate. Moreover, if you leave at least 10% of your net estate to charity, the Inheritance Tax rate on the rest of your estate may be reduced from 40% to 36%.
Creating a Lasting Legacy
A charitable bequest is a powerful way to ensure that your values and passions continue to be supported after your lifetime. It can also inspire your family and friends to consider philanthropy in their own lives.
Steps to Include Charities in Your Will
1. Choose the Charities
The first step is to decide which charities you want to support. Research their missions, values, and how they utilise donations. Ensure that the organisations align with your values and are reputable.
2. Decide on the Type of Gift
Determine what kind of gift you want to leave. This could be a fixed sum of money, a specific asset, or a percentage of your residual estate. Consider consulting with a financial advisor to understand the implications of your choices.
3. Draft or Update Your Will
To include a charity in your will, you must explicitly state your intentions in a legally binding document. Work with a solicitor to draft or update your will. Ensure that the charity’s full name, address, and registered charity number are included to avoid any ambiguity.
4. Inform the Charity
While not mandatory, informing the charity of your intended gift can be beneficial. It allows them to thank you, keep you informed about their work, and plan for the future.
Considerations and Tips
Seek Professional Advice
Including charities in your will can have significant legal and financial implications. It is crucial to seek advice from an estate planning specialist or a financial advisor to ensure that your will is valid and that your estate is distributed according to your wishes.
Communicate with Your Family
Discussing your decision with your family can prevent misunderstandings and ensure they understand and respect your wishes. Open communication can also help them appreciate the values that drove your decision.
Regularly Review Your Will
Your circumstances and priorities may change over time. Regularly reviewing and updating your will ensures that it continues to reflect your wishes accurately. Major life events such as marriage, divorce, the birth of children, or significant changes in financial status are all triggers to review your will.
Be Specific and Clear
When naming a charity in your will, be as specific as possible. Include the charity’s full name, address, and registered charity number. This precision helps to avoid any potential disputes or confusion.
Conclusion
Including charities in your will is a profound way to extend your legacy and support the causes you care about long after you are gone. By understanding the process and seeking appropriate advice, you can ensure that your charitable intentions are clearly articulated and effectively realised. This not only benefits the charities you choose but also provides a meaningful way for your values to endure, creating a lasting impact on the world.
If you are considering this generous act, take the first step today by consulting with us here at The Will Centre to explore your options and make informed decisions. Your future gift can bring hope, change, and inspiration to countless lives, leaving a legacy that truly matters.
