WILLS

Leaving a Cash Legacy to Charity

Leaving a legacy to charity in your Will is a great way of making a difference.

Charities rely heavily on gifts made to them in Wills.

By way of example, the incredible work undertaken by Cancer Research UK was funded in 2021 (figures published on their website) by ‘donation and legacy’ income of some £414.3mil – that being the majority of their total income for that year of £581.9mil.

Here, we explore how you can leave a charitable legacy in your Will, and what the benefits of doing so are.

What is the difference between a Charitable Legacy and a Charitable Gift or Residue?

Legacies are most commonly specified sums of money – eg £1,000. Technically, the legal phrase can also include a ‘thing’ – ie a physical asset of any sort such as property.

However, our residuary estate is ‘everything else’ and is usually gifted in shares or percentages of the total estate. Here we focus on fixed charitable legacies.

What would a Charitable Legacy look like in my Will?

A charitable legacy would look something like this:-

I GIVE £1,000 (one thousand pounds) to Cancer Research UK (RCN 1089464) of 2 Redman Place London E20 1JQ

Key to the gift is making sure that the identity of the charity is clear, as is the amount of the legacy your Will is leaving to them.

What details should be included in a Charitable Legacy in my Will?

A charitable legacy should include:-

Amount (often worded as numbers and words to avoid confusion)
Full charity name
Registered Charity Number (RCN)
Address

The purpose of this is to avoid confusion when it comes to payment of the legacy.

What if the Charity changes its name between making my Will and dying?

It is not unusual for charities to ‘re-brand’.

It is therefore a good idea to have your Wills Solicitor include a specific ‘power’ permitting payment of the legacy by your executors to a charity with its new name. This is to protect your executors, and to help ensure that the gift of money to the charity does not fail.

Why make a Charitable Legacy in my Will?

We each have our own motivations for making charitable legacies in our Will. Perhaps the most common include:-

In memory of a loved one who benefited from charitable work
Following personal experiences during their lifetime

Do I pay Inheritance Tax on Charitable Legacies?

No! Fixed cash legacy gifts are totally free of Inheritance Tax (IHT)! This is true of Charitable gifts of Residue too.

You can help those charities that you care about with a cash legacy in your Will.

Why do I need a Will to leave a Charitable Legacy?

If you die without a Will, your estate is deemed to be ‘intestate’. In those circumstances, the law sets out who gets your estate which is essentially a hierarchy order of relatives as follows (if you are NOT married):-

Children
Parents
Siblings
Grandparents
Uncles/aunts

In short, any wishes you have to make Charitable Legacies will NOT happen unless you MAKE A WILL…!

Can I leave it up to my Executors to leave Charitable Legacies?

No! The whole point of having a will is to create certainty and legally bind your executors to carry out your exact wishes.

Technically you can leave it up to your executors, but in doing that you are deferring the decisions to them, and actually creating what we call a ‘trust’.

Do I have to tell the Charity I have left them a Legacy?

There is no need to tell any of your beneficiaries that you have made provision for them in your Will.

Can my family challenge my will if I leave everything to Charity?

If we are of sound mind when making our Will, it is up to each of us to leave our estate to whomever we choose. Subject to some specific exemptions, a challenge made by a family would not therefore succeed unless it could be proven that the person making the will that included the gift to a charity was:-

Duress – put under pressure when making the will
Not of sound mind – was not compos mentis when making the will
Family Provision – there were family members who were financially dependent upon the deceased and following which the will failed to make provision for their continued support

Can I specify how a Charity use the money I gift to them in my Will?

Well yes, but think carefully before you do. It has been known for Charities to have to refuse legacies where they feel wishes set out in a will can not be discharged by them in accepting the legacy.

Should I set out any wishes I have for the legacy in a Letter of Wishes?

Your will sets out legal framework that binds, for example, your executors. If you seek to set too rigid a use for the legacy you leave to a charity, it may even result in the charitable legacy failing altogether. Better perhaps then to simply leave wishes in a side ‘letter of wishes’ which simply sets out what you would ideally like to happen to the money, rather than seeking to legally bind your executors or the charity.

Expert Wills Solicitors Online

If you have any questions arising out of this blog or related wills/charity posts – do reach out to our expert Wills solicitors. You can contact us below, or at wills@qlaw.co.uk. If you’d rather, do call 03300 020 365.