None of us likes to consider our mortality, but death and taxes are two certainties in life.
Whilst you may not be able to avoid tax completely, charity legacies are one way of making your Will more tax efficient.
Charity legacies can now cost your loved ones just a fraction of the amount you leave to the charities. This results from a reduced rate of Inheritance Tax where you leave at least 10% of your estate to charity, after deducting your tax free allowance.
The following is an example applicable to a married couple. The following illustrates a taxable estate of £750,000 (that is after deducting the Inheritance Tax free allowance of £650,000).
Two scenarios reviewed below:
Scenario A
Taxable estate: £750,000
Charitable donation: £0
Revised taxable estate: £750,000
Inheritance Tax @ 40%: £300,000
Available for family & friends:
£450,000
Scenario B
Taxable estate: £750,000
Charitable donation: £75,000
Revised taxable estate: £675,000
Inheritance Tax @ 36%: £243,000
Available for family & friends:
£432,000
We are grateful for whatever contribution you can make
For further advice call us on 020 8187 9881