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What is a Legacy?
A legacy is a gift in a will to benefit other people or a charity. It is an important means of providing for your loved ones and of supporting causes which are important to you.
Why leave a legacy to the Diving Diseases Research Centre?
Your legacy can make a huge difference to the work of the Charity, not only in its own right, but also to act as matched funding to release grants from grant giving bodies. This could make it worth three to four times more than the original legacy.
Your action today will help ensure that the Charity can fulfil its commitments: to the service for divers and patients, the research and the training.
Legacies and Tax
Charitable legacies can save you tax.
Although husbands and wives can leave their estates to each other free of tax, on the second death the whole estate becomes liable to tax at 40%, with an allowance of the first £255,000 (from 9th April 2003).
In other words, everything that is left in the will above the threshold of £255,000 will be taxed at 40%. Due to rising property prices, it is becoming increasingly common for estates to be worth more than this threshold.
One way to reduce this tax liability is to include a legacy to a charity in your Will. For every £10,000 above the threshold that is left in this way, a tax saving of £4,000 is made, as charitable legacies are tax free.
Your solicitor will be able to give more detailed advice about inheritance tax and how to reduce your liability in your Will.
What are the different types of Legacy?
There are several types, depending on what you own and how you intend to distribute it.
A residual legacy is the remainder of your estate, after debts and expenses have been paid off. It can be left in entirety to someone or an organisation, or shared among named beneficiaries. As an example, three children could receive a quarter each, with the final quarter left in your favourite cause.
A cash sum, or pecuniary legacy, often linked to inflation. An example would be £10,000 left to a charity, linked to the retail price index from the date of your will.
A reversionary legacy. This is where a benefit to someone during their lifetime, after which ownership is transferred to another beneficiary. A typical example is that of a house, where a relative may live until their death, when ownership passes to a charity.
A specific legacy. You can also bequeath specific personal assets such as property, stocks and shares, books art and equipment. If you are considering leaving a collection of books or equipment related to diving to the charity we would welcome the opportunity to discuss your plans with you before you commit them to your will.
Suggested wordings for Legacies left to the Diving Diseases Research Centre
These suggested wordings can be incorporated into a new will or can be added by means of a codicil to an existing Will.
For the whole residue of an estate
“Subject to payment of my just debts, funeral and testamentary expenses and any legacies, I give all the residue of my estate, both real and personal to The Diving Diseases Research Centre. The receipt of the Treasurer, or other authorised officer, shall be sufficient discharge of the same.”
For a share in the residue of an estate.
“Subject to payment of my just debts, funeral and testamentary expenses and any legacies, I give all the residue of my estate, both real and personal to and equally between the following…..
As to one part thereof (to Diving Diseases Research Centre), the receipt of the Finance Manager, or other authorised officer, shall be sufficient discharge of the same.”
For a cash sum
“I give to the Diving Diseases Research Centre the sum of £……. free of all taxes and duties and linked to the retail price index from today and I declare that the receipt of the Finance Manager or other authorised officer, shall be sufficient discharge of the same.”
For a specific legacy
“I give to the Diving Diseases Research Centre my: (full description of item/items and its/their location) absolutely and for the general purposes of Charity and I declare that the receipt of the Finance Manager or other authorised officer, shall be sufficient discharge of the same.”
Deciding the purpose of your Legacy
When leaving a legacy to a relative or friend, you will normally want to let them decide what they will do with it, as their needs dictate. It is always possible, however, to determine a specific purpose, if this is important to you. The same is true for a charitable legacy. To provide the maximum flexibility in how your legacy is used, you may wish to leave this decision to the discretion of the Trustees of DDRC, who can then apply your legacy to whatever needs arise in the future. The Charity will be grateful for this flexibility.
And finally…
If you decide to leave a legacy to the Diving Diseases Research Centre, it would greatly help us to know your intention, in strictest confidence.
Your response will help the Charity to measure the impact of the legacy promotion and to plan for the future. Your details will not be divulged to any other body. If you require further information please do not hesitate to contact us.
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