More people left gifts to charity in their Will than ever in 2022
Though the ongoing ‘cost of living crisis’ continues to put a strain on personal finances, an increasing number of people are choosing to gift to charity when it comes to writing their Will.
New data suggests that the number of charitable gifts left in Wills hit a record high in 2022, highlighting the diversifying ways in which individuals choose to distribute their estates beyond simply passing everything on to their family.
According Will Writing firm Smee & Ford, of the 231,582 Wills they processed in 2022, some 36,922 (nearly 16%) included a gift to charity. These gifts totalled £21.3bn, the highest on record for the firm.
Of course, apart from the act of generosity associated with gifting to a charity, there can also be tax benefits associated with gifting in this way. For a start, any gift to charity is free from inheritance tax which means that you effectively get ‘more’ for your money by donating than by passing on to a loved one.
Beyond that, if you leave 10% or more of your estate to charity you will benefit from a lower inheritance tax rate of 36% on the rest of your estate, as opposed to the standard 40% on estates worth more than £325,000. This means that, in certain circumstances, it is possible to leave a generous donation to charity and lower your overall IHT bill, enabling you to leave more to your loved ones than you would have otherwise been able to.
Dicky Davies, Business Development Director and co-founder of Tower Street Finance said: “These figures from Smee & Ford highlight the continued generosity of people when it comes to charitable giving, and the way in which estate planning can take many forms beyond simply passing down assets to spouses and children.
“Such actions are only possible with a Will in place and so if you are thinking about leaving behind a charitable donation when you pass away, it’s important to take steps to plan accordingly.”
“On the other side of things, as an executor of a will, finding out that a recently deceased loved one has intended to leave some of their estate to charity can complicate the process of probate. This is especially true if the terms in their Will are not clear, which can result in delays in receiving an inheritance.”
Find out more about Tower Street Finance’s probate lending solutions or call us on 0343 504 7100.