Do I have to leave a charitable donation in my Will?
Posted on 10th April 2024
Making a Will is a pivotal part of estate planning, allowing individuals to determine how their assets will be distributed after their death. Among the many decisions to be made when writing a Will is whether to include a charitable donation. This blog from our Wills Solicitors in Preston explores the considerations surrounding the inclusion of charitable donations in Wills, providing guidance on whether you should leave one and the impact it could have.
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Legal Obligations
First and foremost, it’s important to clarify that there is no legal obligation to leave a charitable donation in your Will. Your Will is a personal document that reflects your wishes regarding the distribution of your estate. While many choose to include charities in their final wishes, it is entirely a personal choice based on individual values, financial circumstances, and whether a person feels they wish to benefit charity.
A common form of gift to charity is a one-off payment, such as a cash gift. Our Wills Solicitors see many values of cash gifts, often proportionate to the person’s estate value, from £50 to £10,000, and higher. It may feel that leaving a charity a ‘small’ gift of £50 is not worth it, however, from the charities our Wills Solicitors have worked with over the years, we can tell you that every little donation makes a difference. One common charity we work with is St John’s Hospice, based in Lancaster, and we have also done work with St Catherine’s Hospice, in Preston; both are great charities, offering care to those most in need in the local communities, and only two of the thousands of potential charities you could make a gift to in your Will.
A charitable gift could also take the form of a donation of items to a charity. Some common gifts our Wills Solicitors have seen include gift of unused medical and care equipment, providing certain conditions are met, gifts of war memorabilia, and paraphernalia, such as arts and crafts items. Every gift is very much appreciated, and even considering a charitable gift in your Will can be a good idea.
Personal Values and Charitable Interests
Many individuals decide to include a charitable donation in their Will as a way to support causes they cared about during their lifetime. This can be seen as a way to leave a lasting legacy and to make a positive impact on the world beyond your lifetime. If there are particular charities or causes you have supported throughout your life, you may wish to consider leaving them a gift in your Will.
Another common theme for charitable gift giving that our Wills Solicitors in Preston see is when people leave a gift to an animal charity, either where they purchased their beloved pet from, or perhaps a local charity they feel is deserving of the support. As a nation of pet lovers, most of us can get behind giving to a charitable cause supporting animals.
Financial Considerations
When contemplating a charitable donation, it’s crucial to review your financial situation. Ensure that your family and dependents are adequately provided for before allocating funds to a charity. Some people choose to leave a fixed sum of money, while others may leave a percentage of their estate or specific assets. Consult with a financial advisor or Wills Solicitor to understand the potential tax benefits and implications of including a charitable bequest in your Will. Charitable gifts can, in some cases, have beneficial inheritance tax implications, which can be another reason why people decide to make such a gift in their Will; an inheritance tax saving plus the benefit of donating money to a good cause could be a win-win situation for some of our clients.
Tax Implications
As touched on above, in England and Wales, leaving a charitable donation in your Will can have tax advantages. For example, charitable donations are often exempt from inheritance tax, which can reduce the overall tax burden on your estate. This not only benefits the charity but can also increase the inheritance for your other beneficiaries by reducing the amount of tax payable. Again, professional advice can help you understand the tax implications in your specific context.
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How to Include a Charitable Donation in Your Will
If you decide to leave a charitable donation, ensure that it is clearly outlined in your Will. Our Wills Solicitors in Preston will specify the name and address of the charity, the amount or assets you wish to donate, and any specific wishes you have regarding the use of the donation. We also include identifying information, such as the registered charity number, which we obtain from gov.uk’s Charity Register. In some cases, it’s advisable to speak directly with the charity to understand any specific wording or requirements they may have for bequests. Often charities have their own wording to help them make use of the gift quicker or more effectively, so our Wills Solicitors often contact charities to obtain their wording requirements before finalising a Will.
Here are a few notable English cases related to charitable donations left in wills:
Re Ratcliffe [1948]:
This case is significant in the realm of charitable trusts. It addressed the issue of the "cy-près doctrine," (Cy-pres can be roughly translated to “as near as possible”) and is a principle that can be used to prevent a charitable legacy from failing to take effect by passing it to a similar purpose or charity, which applies when a charitable gift cannot be fulfilled as originally intended. In this case, the court had to decide how to apply a charitable donation when the specific purposes could not be achieved. The cy-près doctrine allows the court to apply the donation to a similar charitable purpose that closely matches the testator's original intention.
Re Resch’s Will Trusts [1969] AC 514:
This case involved a significant bequest to a charitable organisation associated with a hospital in an Australian case, appealed to the UK Privy Council. The key issue was whether the donation constituted a charitable gift, given the close relationship between the charitable entity and the for-profit hospital. The House of Lords ultimately held that the donation was charitable, emphasising the importance of the purpose of the gift over the precise nature of the recipient organisation.
A-G v National Provincial and Union Bank of England [1924]:
Known as the “Macduff case,” it is a landmark case for its exploration of what constitutes a charitable purpose. The case dealt with a will that made provisions for the promotion of certain ideals, and the court had to determine whether these constituted charitable purposes under the law. The decision helped to define the legal boundaries of charitable intentions within wills.
Re Scarisbrick [1951]:
This case tackled the issue of conditional charitable legacies. The testator left a legacy to a charity on the condition that certain actions were taken by the beneficiaries. The case highlights the complexity of conditional bequests to charities and how such conditions are interpreted by the courts.
Re Hobourn Aero Components Ltd’s Air Raid Distress Fund [1946]:
In this case, a fund was created during World War II to assist employees who suffered due to air raids. After the war, the question arose about what to do with the remaining funds. The court applied the cy-près doctrine to redistribute the leftover funds for charitable purposes closely aligned with the original intent, underlining the flexibility the courts have in ensuring charitable donations fulfil a public benefit.
These cases illustrate the various legal issues that can arise when charitable donations are made through wills, including the interpretation of the testator's intentions, the application of the cy-près doctrine, and the definition of charitable purposes under English law. They highlight the careful consideration the courts give to ensuring that charitable bequests are honoured and applied in a manner that serves the public good.
Deciding whether to include a charitable donation in your Will is a deeply personal decision that depends on your financial situation, personal values, and the needs of your dependents or loved ones. While it is not a legal requirement, a charitable bequest can be a way to support important causes and leave a lasting legacy. Before making a decision, consider your options carefully, seek professional advice, and ensure that your Will clearly reflects your wishes by having it prepared by professional Wills Solicitors in Preston.
Remember, your Will is a reflection of your values and priorities. Whether you choose to include a charitable donation is entirely up to you, but it’s an option worth considering as part of your overall estate planning strategy, having positive tax implications and supporting worth-while charitable causes after your lifetime.
To instruct our Wills Solicitors in Preston with making a Will, contact the team on 01772 783314 or email wills@mglegal.co.uk. Remember, MG Legal’s Wills Solicitors are SRA-regulated, and Association of Lifetime Lawyers accredited, meaning they are well versed in drafting professional, valid Wills for people with all different circumstances.
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