Today Prince Alalweed (no.34 on Forbes rich list) announced his intention to gift his personal fortune, estimated at $32billion, to charity.
Thankfully you don’t need to be on the Forbes list of the richest people in the world to take part in charitable gifting and there are many benefits to be obtained – as well as the moral and spiritual.
Lifetime gifting in significant amounts may not be feasible due to the many other calls on our wallets arising simply by living the life we want to lead. Another, more practical, option is gifting assets on death through carefully drafted Wills. By gifting on death you can ensure it does not affect your standard of living or leave you short in a crisis.
Gifting to charities through your Will can also attract Inheritance Tax savings. It is not right for everyone so personal advice is essential. In short, however, gifts to charities in your Will are exempt from Inheritance Tax and if you leave enough your estate will benefit from a reduced Inheritance Tax rate.
It is even possible, to reduce the Inheritance Tax rate without reducing the amount your non-charitable beneficiaries actually receive. For people with more than £650,000 in assets this may make sense.
Charitable gifting is one way to mitigate your Inheritance Tax liability and feel good. Much like nutritional information (balanced diets and the like) it should be part of a considered plan constructed from an informed position.
The information contained in this document provides background information only and should not be relied upon as an exhaustive list of the legal issues involved.
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Published by Simon Crooks 2 July 2015