Philanthropy, tax and legacy planning

The most generous giving can also be the most strategic, but only if you understand the UK tax rules behind it. Leonora Stevens and Mike Hodges, private wealth partners, discuss philanthropy from a private client perspective, focusing on how to give with clarity, avoid common traps, and build a plan that fits your wider wealth management and estate planning goals.

This episode starts with Gift Aid, because it underpins most UK charitable giving. We explain how the basic rate reclaim works, how higher and additional rate taxpayers can claim further income tax relief, and why some donors get caught out by an unexpected Gift Aid tax charge when they’ve not paid enough tax. We also look into practical planning: using donations to manage thresholds such as the £100,000 personal allowance taper and child benefit clawback, plus the rules on when a cash donation can be carried back to the prior tax year.

We cover gifting quoted shares and securities, including why it can be so effective for capital gains tax (CGT) planning and income tax relief, and what to consider if you’re also making Gift Aid cash donations. We then look at inheritance tax (IHT) relief, charitable legacies, and the reduced 36% IHT rate where at least 10% of the estate goes to charity, alongside why careful will drafting matters when charity trustees are involved.

Finally, we compare donor advised funds (DAFs) with running a private charitable foundation, including anonymity, administration, governance, and how philanthropy can help engage the next generation through shared decision-making and impact.

If you’d like to find out more about how we can support your philanthropic goals, then please do get in touch.

You may also be interested in our article covering tax relief on charitable donations.