Leaving Money to Charity in a Will

How does leaving money to charity in a will work?

You name a charity in your will and set out what it should receive, whether a fixed sum, a specific item, or a share of what is left. On death, the executors pay that legacy to the charity as part of administering the estate. Gifts to qualifying charities are generally exempt from inheritance tax, so they are deducted before tax is calculated (gov.uk, leaving gifts to charity in your will, as at July 2026, subject to change).

The inheritance tax position on charitable gifts

Charitable legacies do two things for inheritance tax. First, the gift itself is generally exempt, so it reduces the taxable estate pound for pound (gov.uk, as at July 2026, subject to change). Second, a large enough gift can lower the rate charged on the taxable remainder. The standard rate is 40% above the available thresholds, with the ordinary nil-rate band at £325,000 per person (gov.uk, as at July 2026, subject to change).

Allowance or rate	Level (July 2026)
Nil-rate band (per person)	£325,000
Residence nil-rate band	Up to £175,000
Standard rate	40%
Reduced rate (10%+ to charity)	36%
Gifts to charity	Generally exempt

Allowance or rate

Level (July 2026)

Nil-rate band (per person)

£325,000

Residence nil-rate band

Up to £175,000

Standard rate

40%

Reduced rate (10%+ to charity)

36%

Gifts to charity

Generally exempt

Source: gov.uk/inheritance-tax and gov.uk, leaving gifts to charity in your will. The nil-rate bands are fixed until the end of the 2030-31 tax year (5 April 2031) (gov.uk), as at July 2026 and subject to change. For the wider picture, see how to reduce inheritance tax.

The 36% rate for gifts of 10% or more

Where a person leaves 10% or more of the net value of their estate to charity, the estate can pay inheritance tax at a reduced rate of 36% on some assets, rather than the usual 40% (gov.uk, as at July 2026, subject to change). The net value here is broadly the estate after debts, reliefs, exemptions and the nil-rate band, so the 10% is measured against that figure rather than the headline total.

Because the maths turns on the net figure and how the estate is divided into components, the effect varies from estate to estate. HMRC provides a reduced rate calculator to help work out whether the 10% test is met (gov.uk, inheritance tax reduced rate calculator, as at July 2026, subject to change). Getting the sums right can be involved, so many people check the position with a qualified professional.

Types of charitable gift in a will

A charitable legacy can be structured in a few ways, and the wording matters because it decides exactly what the charity receives. The three common forms are a fixed cash gift, a gift of a particular asset, and a share of the residue. Each interacts differently with the inheritance tax exemption and with the 10% test for the reduced rate (gov.uk, as at July 2026, subject to change).

Type of gift	What it means
Pecuniary legacy	A fixed sum of money, for example a set cash amount to a named charity.
Specific legacy	A named asset, such as shares, property or a personal item.
Residuary gift	A share, or all, of what remains after debts, expenses and other gifts.

Type of gift

What it means

Pecuniary legacy

A fixed sum of money, for example a set cash amount to a named charity.

Specific legacy

A named asset, such as shares, property or a personal item.

Residuary gift

A share, or all, of what remains after debts, expenses and other gifts.

A residuary share is often used where someone wants to meet the 10% test, because it flexes with the final estate value. A fixed cash sum is simpler but may fall short of, or well above, 10% depending on how the estate turns out.

A worked example (illustration only). Suppose an estate has a net taxable value of £200,000 after the £325,000 nil-rate band and other exemptions are applied (gov.uk, as at July 2026, subject to change). If nothing goes to charity, tax at 40% on £200,000 is £80,000. If instead 10% of that net figure, £20,000, is left to charity, the charitable gift is exempt and the remaining £180,000 can be taxed at the reduced 36% rate, giving £64,800 (gov.uk, as at July 2026, subject to change). In this illustration the charity receives £20,000 while the tax bill falls by more than the standard-rate figure would suggest. Every estate is worked out differently and the net-value calculation is more involved than this, so it is general information rather than a calculation for any real estate.

Getting the wording right

Small drafting details make a large difference to a charitable gift. Naming the charity correctly, including its registered charity number, helps executors identify the right organisation and avoid disputes. It also helps to say what should happen if the charity merges or closes before you die, and whether the gift is free of tax. Because charitable clauses interact with the 10% test and the rest of the will, many people have them drafted alongside professional advice (gov.uk, as at July 2026, subject to change).

Name and number. Use the charity's full legal name and registered charity number.

Continuity. Say what happens if the charity later merges, changes name or closes.

Type of gift. Decide between a fixed sum, a specific asset or a share of residue.

Review. Revisit the gift if the estate or the 10% position changes over time.

For the broader mechanics of drafting, our guide on How to Write a Will sets out the wider steps, and the estate planning guide shows how a charitable gift fits alongside the rest of a plan.

Charitable gifts in Scotland and Northern Ireland

Inheritance tax is a UK-wide tax, so the exemption for charitable gifts, the 40% standard rate and the reduced 36% rate where 10% or more of the net estate passes to charity apply across England, Wales, Scotland and Northern Ireland alike (gov.uk, as at July 2026, subject to change). What differs is the surrounding succession law. Scotland has legal rights that can entitle a spouse and children to a fixed share of the estate, which can limit how much of the estate is free to leave to charity, and it uses confirmation rather than a grant of probate. Where an estate touches more than one UK nation, it can be worth taking advice in each.

Frequently asked questions

Do you pay inheritance tax on money left to charity?

Generally no. A gift to a qualifying charity in a will is exempt from inheritance tax, so it is taken off the value of the estate before any tax is worked out (gov.uk, as at July 2026, subject to change). The charity receives the gift in full, and the exemption also reduces the taxable value of the rest of the estate, depending on circumstances.

How much do you have to leave to charity to reduce inheritance tax to 36%?

The reduced 36% rate can apply where 10% or more of the net value of the estate is left to charity, instead of the usual 40% on the taxable part (gov.uk, as at July 2026, subject to change). The net value is measured after debts, reliefs, exemptions and the nil-rate band, so the calculation can be involved. HMRC offers a reduced rate calculator to help check the position.

What counts as a charity for inheritance tax?

For inheritance tax the word charity takes its normal meaning and includes registered community amateur sports clubs and bodies that meet the requirements for being a charity (gov.uk, as at July 2026, subject to change). Naming the organisation correctly, with its registered charity number where it has one, helps executors identify the right body and apply the exemption.

Can a charitable gift be added to a will after someone has died?

In some cases yes. Beneficiaries can vary a will after a death, for example to redirect part of an estate to charity, and any change must generally be completed within 2 years of the death with the agreement of anyone left worse off (gov.uk, altering a will after death, as at July 2026, subject to change). This can affect the tax position, so many people take advice before doing it.

Is a residuary gift better than a fixed sum for the 36% rate?

It depends on the estate. A share of residue flexes with the final estate value, so it can be easier to keep at or above the 10% net-value threshold needed for the reduced 36% rate (gov.uk, as at July 2026, subject to change). A fixed cash sum is simpler but may fall short of 10% if the estate grows. It can be worth discussing the choice with a qualified professional.

Do I need a solicitor to leave money to charity in my will?

Not always, though the wording matters. A simple charitable gift can be included in a straightforward will, but where the 10% reduced-rate test, larger sums or complex estates are involved, many people choose to take advice from a solicitor or a STEP practitioner. Because charitable clauses interact with the rest of the will, careful drafting helps avoid later disputes.

About Fairchild Oldfield

The Fairchild Oldfield team brings together estate planning, tax, independent financial advice and client care, working with families across England and Wales.

Fairchild Oldfield are estate planning specialists and will writers, not a firm of solicitors. This article is general information based on practical experience, not legal, tax or financial advice.

Important: This article is general information only and is not legal, tax or financial advice. Reading it does not create a professional relationship. It is based on the law of England and Wales, and other UK jurisdictions may differ. Figures and rules are current as at July 2026 and are subject to change. Before acting, many people choose to seek advice from a suitably qualified professional, such as a solicitor, a STEP practitioner, an accountant, or an FCA-authorised financial adviser, who can consider your individual circumstances.

Leaving Money to Charity in Your Will