New research suggests that Britons are saving a record amount of Inheritance Tax (IHT) by leaving money to charitable causes in their Wills.
In the UK, each individual is entitled to pass on £325,000 worth of assets before they are charged IHT. After this threshold or ‘nil rate band’, IHT is levied at a rate of 40 per cent.
However, for those who leave at least ten per cent of their estate to a charity, IHT is levied at a reduced rate of 36 per cent, following legislative changes first introduced in 2012.
According to the latest Government statistics, there has been a dramatic increase in the number of charitable donations left in Wills since these rules took effect.
In the year to March 2017, the amount of IHT relief claimed through bequests to charities rose to £880m – representative of a 16 per cent year-on-year rise.
Over the past five years, the amount of IHT relief claimed has more than doubled from the £420m recorded in 2010/11, before the new rules were introduced.
Recent analysis suggests that Britons will be saving more than £900m on IHT by 2017/18.
Leaving money to a charitable cause in your Will can be achieved by consulting a specialist solicitor for tailored advice to suit your unique circumstances.