Legacies

All gifts to charities in wills are tax-free because gifts to your church and other charities are deducted from the value of your estate when inheritance tax (IHT) is calculated. Currently (2014-2015 tax year), IHT is payable on estates worth more than £325,000 at a rate of 40%. Moreover, if you leave gifts to charity (including churches) in your will totalling 10% (or more) of the value of your estate, the rate of IHT you pay will be only 36%. Inheritance tax can be complicated, and you are advised to seek specialist tax advice if your estate is large or your affairs are complex.