Leave a Lasting Legacy

Why leave a legacy gift in your Will?

Writing a will is something we all know we need to do but it’s a task many of us would gladly avoid. A will not only gives your loved ones peace of mind that they’ve fulfilled your wishes but also you’ll leave a legacy, helping others after you’re gone.  

What is a legacy gift?

A legacy gift is a contribution to a charity that reflects something important about the values of the donor.  A legacy gift can be in the form of a bequest (simply writing in the will ‘I wish to leave £xxx to xxxx charity), proceeds from life insurance, a trust, an annuity, an estate or even a retirement fund.   Financial planners can help prepare a legacy gift or many online resources can help organise such a gift. 

How Legacy Gifts Differ from Other Charitable Donations

When we think of donating to a charity it’ll often be a variety of donations we make throughout our life from a one-off donation to regular monthly giving.  A legacy gift is different as it’s planned to be given after the donor has passed away and often represents a significant donation representing a proportion of their estate acquired over their lifetime. 

From a financial perspective, a legacy gift is also a chance to leave a major donation that may not have been possible during the donor’s lifetime due to financial commitments. Charity gifts are also exempt from Inheritance Tax in the UK, and the government provides a further incentive when you give at least 10% of your taxable estate to charity, the inheritance tax rate for the rest of your estate drops from 40% to 36%.

Why Legacy Gifts are so important 

A legacy gift often reflects a donor’s values and beliefs. As it’s planned the gift is often a very personal one reflecting an important part of their life and how they want to be remembered among friends and family. 

It’s also a way of ensuring that the work of a charity can continue after you’re gone. As legacy gifts can be more substantial than a ‘normal’ donation they can have a huge impact on a charity allowing them to take on a major project that will make an impact for years to come. 

Types of Legacy Gifts You Can Leave

Bequests

A bequest is the most common type of legacy gift and is as simple as naming a charity in your will. It can be a specific amount, a percentage of your estate or what remains once other bequests have been made. 

Charitable Trusts

A charitable trust is a qualified trust that pays income to beneficiaries. After all income payments have been completed, the remainder is distributed to qualified charities. With this trust, you’re able to bypass capital gains tax, increase income, and receive a charitable income tax deduction.

Gifts of Life Insurance and Retirement Plans

A charitable gift of life insurance is a way of contributing to charity by taking out life insurance on yourself and naming a charity as a beneficiary. 

Real Estate and Personal Property Donations

Individuals don’t have to pay tax on land, property or shares they donate to charity. Donating it to charity, as opposed to selling it, can eliminate the capital gains tax and may entitle you to an immediate fair market value charitable deduction, among other benefits.

Donor-Advised Funds as Legacy Gifts

A donor-advised fund (DAF) is like a managed charitable investment account for the sole purpose of supporting a variety of charities you care about beyond your lifetime. It’s seen as a good way to reduce admin, time and costs while fulfilling your wishes. 

See how leaving a legacy gift to Humanity Direct will save and change lives by visiting our Success Stories.