Inheritance tax planning news – STEP takes lead on clause
Under the proposed inheritance tax planning changes, testators would be able to reduce their tax burden from 40% to 36% by leaving at least 10% of their estates to charity.
The clause STEP has submitted to the Treasury reads as follows:
“I give (name of charity) such a sum as shall constitute a donated amount equal to 10 (or insert larger figure) per cent of the baseline amount in relation to my estate passing under this will as defined in each case in schedule 1A Inheritance Tax Act 1984 ignoring any election under paragraph 7 of the schedule. My executors may appropriate assets not otherwise specifically bequeathed to satisfy (or partly satisfy) this legacy without the consent of any beneficiary under my will or any codicil to my will.”
If things go smoothly then it is likely that the inheritance tax planning changes will take effect in April, meaning wills solicitors will then be able to use the STEP clause with confidence.
“If it is approved then it will be something for charities to use and propose to people to put in their wills,” commented a spokesperson from STEP.News