Leave a lasting impact?

Consider a gift in your Will

Your support can help create a future where disabled people have the same opportunities as everyone else, and a gift to Scope in your Will can change your tax liability for the better. Find out more below how Inheritance Tax can be reduced when you leave gifts to charity in your Will and read the stories of the impact you can have on disabled people’s lives.

Inheritance Tax

If your estate is worth more than £325,000 when you die, then Inheritance Tax may have to be paid at 40% for the amount above the base £325,000. As an example, if your estate is worth £350,000 then £25,000 of this is subject to Inheritance Tax. Therefore £10,000 would be deducted.

There are some ways that this tax can be avoided. These are the two main methods:

  • When you leave a charitable gift this will not be included within any tax calculations. This applies to all donation amounts.
  • The Inheritance Tax reduces from 40% to 36% if you leave 10% or more of your net estate to charity. Inheritance Tax also does not apply to the charity itself, meaning that all of your donation will go directly to your supported cause.

If you are leaving your estate to your wife, husband or civil partner then they will not need to pay Inheritance Tax. You are able to transfer any unused nil rate band allowance (the value of an estate that is not subject to Inheritance Tax), to your spouse or civil partner, meaning that they can then have the equivalent of both nil rate bands, e.g. £650,000, on their death. Inheritance Tax would then be charged at any amount above £650,000.

You can find out more about Inheritance Tax.

Capital Gains Tax

If you sell or give away something that has increased in value since you brought or were given it, then you may be subject to Capital Gains Tax. The taxable element would be the increase in value. The current tax free allowance is £11,100, so it would be anything worth more than this amount that is subject to the tax. For example, if a piece of jewelry you bought cost £12,000 at the time of purchase but has now been valued at £16,000, the increased value of £4,000 would be taxable.

In terms of your Will, the value of your items will be investigated for sale or distribution and any increase in values that arise may be liable to Capital Gains Tax.

Capital Gains Tax does not apply to charities, which means that when Charities are a named beneficiary in your Will the estate can benefit from reduced Capital Gains Tax.

You can find out more about Capital Gains Tax.