The fatal plane crash that killed the Compass tycoon Richard Cousins highlights a need for sensible provisions in last will and testaments. Oxfam are set to benefit from a ‘common tragedy clause’ in Mr Cousins will that left the residue of the estate, worth £41m, in the unlikely event that he and his two sons were killed in the same event.
A more standard clause, one I use, nominates a charity to receive the residue of an estate if no living relatives or dependent claimants can be found.
An out right bequest of a fixed or sometimes variable sum is more common. Oxfam alone received £20m in gifts through wills last year and after recent PR disasters will be grateful for all contributions.
HM Revenue and Customs allow ‘people who inherited a deceased’s household and personal goods but wish to donate some or all of them to a UK charity to deduct a charity exemption against the value of the estate.
Any property forming part of the deceased’s estate which passes on death to charity is exempt from Inheritance Tax (IHT). Gifts to certain national bodies, such as museums and art galleries or political parties also qualify for a similar exemption.
A deed of variation is a document designed to redirect inheritance in someone’s will and can be used to benefit charities and may reduce IHT.
Large estates and national treasures have been accepted by HMRC in payment or part payment of IHT.