Whilst the COVID-19 pandemic has significantly increased the number of Wills being written, a recent story in London Loves Business included the statistic that 44% of pet owners have made provision for the welfare of their pets in their Will, averaging as much as £3,642. Based on data from Statista.com, there are 51 million domestic animals in the UK. This would mean pets in the UK have been left over £80 million in owners’ Wills.
Whilst you cannot directly bequeath money to an animal in a Will, it is possible to leave it in trust so that their welfare can be taken care of by specified beneficiaries, writes Shelina Vaiya, an Associate Solicitor in our Private Client team.
The value of gifts left in a Will to loved ones and charities has also risen since the start of the COVID-19 pandemic. Despite the economic uncertainty of these times more than £150 million was left to charity in 2020.
Reported here, giving to charity peaked during April 2020, with £35 million pledged. That is 775 per cent more than before the start of the pandemic, where there was an average total legacy of around £4 million a month.
A quarter of all gift donations went to cancer charities, but donors were most generous to religious organisations.
Leaving large sums of money to ensure the welfare of pets is also popular amongst celebrities and the wealthy. According to London Loves Business: “The richest cat in the world is reportedly a black cat named ‘Blackie’ who inherited £7 million in 1988 when his owner Ben Rea – an antiques dealer – left a good portion of his fortune to his beloved pet.
“TV host Oprah Winfrey will also reportedly leave $30 million (£23 million) to her five dogs, and Actress Betty White will reportedly leave $5 million (£3.7 million) to her dog.”
As well as making provision for loved ones in a Will, the gifting of money to loved ones can also be an efficient way of reducing Inheritance Tax liabilities.
Neil Rushton, a Chartered Financial Planner at Old Mill, was quoted earlier this month here making the interesting observation that, “Baby boomers are the only generation to be richer than both their parents and their children and many have found themselves in an even stronger position as a result of reduced spending during the crisis, while younger generations have been hit by job losses and reduced income.
“Passing on wealth to children and grandchildren now, rather than as an inheritance, makes a lot of sense… it is obviously much nicer to be able to see your family benefit from the money while you are still alive, but also, it makes sense to pass it on now, when they actually need help, rather than have them inherit when they are retired or nearing retirement themselves.”
The rules might change on the Chancellor’s Spring Budget on 3rd March but at present UK taxpayers have an annual gift allowance of up to £3,000 each tax year without Inheritance Tax implications, which can be carried forward for one year if individuals do not use the full sum.
Tax free gifts of up to £250 can be given to any number of people in the same tax year so long as they are not to anyone who has already received part or all of someone’s annual gift allowance.
Gifting, aside from helping family members, could also provide assistance to charities. Whatever you do, whether you want to provide for your pet when you are gone, or you would like to help your loved ones whilst you’re still here do seek legal advice on Will writing to make sure all your wishes are followed.
Our Private Client lawyers have the knowledge and experience to guide you through these challenging times and have been ranked in the Legal 500 for their expertise.
If you are in need of advice or assistance on any of the issues mentioned in this article please contact Shelina Vaya or another member of our expert Private Client Team on 020 7631 4141 or email firstname.lastname@example.org
The above is correct as at 14 January 2021. The information above may be subject to change as this is a constantly evolving situation.