Charitable giving continues to make a significant impact across the UK, with HMRC figures showing tax reliefs for charities and donors reaching approximately £7.4 billion in the tax year to April 2026 – a 4% increase on the previous year. The figures highlight the continuing importance of tax-efficient giving and the growing role of legacy gifts as a source of sustainable income for charities.
Importantly, these figures are not just relevant to the largest national charities. Almost half of all Gift Aid payments were made to charities receiving less than £1 million each, with 67,650 organisations benefiting from Gift Aid during the year. This demonstrates that tax-efficient giving continues to provide meaningful support to charities of every size.
Legacy Giving Continues to Deliver Lasting Impact
While fundraising campaigns and regular donations remain essential, gifts left in Wills provide charities with a valuable source of long-term income, helping to fund projects, expand services, recruit staff and plan for the future with greater confidence.
Charitable legacies can affect inheritance tax in two important ways. Gifts to qualifying charities are generally exempt from inheritance tax, and where at least 10% of a net estate is left to charity, the inheritance tax rate on the remainder of the taxable estate can be reduced from 40% to 36%.
The latest HMRC figures show inheritance tax relief for charitable gifts increasing to £1.28 billion, around 6% higher than the previous year. While only a relatively small proportion of estates are subject to inheritance tax, these figures demonstrate how legacy gifts can both support charitable causes and deliver valuable tax benefits for donors’ estates.
Looking ahead, charitable legacy giving is likely to become even more significant. From April 2027, the Government intends to bring most unused pension funds and certain death benefits within the scope of inheritance tax. As more estates may become liable to inheritance tax, charitable gifts in Wills are likely to play an increasingly important role in estate planning, allowing individuals to support the causes they care about while potentially reducing the inheritance tax payable on their estate.
Legacy gifts can have a transformative impact on charities by:
- Providing long-term financial security.
- Funding major projects, services and capital developments.
- Enabling charities to plan strategically for the future.
- Creating a lasting connection between supporters and the causes they care about.
For supporters, leaving a charitable legacy provides an opportunity to continue supporting a cause long after their lifetime. For charities, it creates certainty, helping them invest in services, develop future projects and safeguard their long-term sustainability.
Why Charities Should Be Thinking About Legacies Now
The continued growth in Gift Aid, higher-rate tax relief and inheritance tax relief demonstrates that donors continue to recognise the value of tax-efficient giving, both during their lifetime and through their Wills.
Self Assessment data reinforces that picture. During the tax year ending April 2025, 1.3 million people declared charitable donations on their tax return. Although this represented a slight reduction in the number of donors compared with the previous year, the total value of declared donations increased by 12%, rising from £4.1 billion to £4.7 billion.
Legacy giving should not be viewed in isolation. A successful legacy programme combines effective fundraising, supporter stewardship, robust governance and efficient estate administration. By taking a joined-up approach, charities can encourage more legacy pledges while ensuring that every gift is managed professionally and in accordance with the donor’s wishes.
Against this backdrop, charities should consider whether they are making the most of the opportunities presented by legacy giving. This may include:
- Reviewing their legacy fundraising strategy.
- Ensuring supporters understand how a gift in their Will can make a lasting difference.
- Developing effective stewardship programmes for legacy pledgers.
- Putting robust processes in place for receiving and administering charitable legacies.
The Importance of Specialist Legacy Support
Receiving a charitable legacy is not always straightforward. Charities may need to deal with a range of legal and administrative issues, including estate administration, inheritance tax, reviewing estate accounts, liaising with executors and personal representatives, and resolving disputes where they arise.
Specialist legal support can help charities deal with these issues efficiently, protect their position, preserve positive relationships with executors, beneficiaries and supporters’ families, and ensure that donors’ wishes are respected.
Supporting Charities Through Every Stage of Legacy Giving
At TE Charity Assist, we believe charities should be supported throughout the entire legacy journey—not simply when an estate is being administered.
Our service is built around three key pillars:
- Legacy Creation – helping charities develop sustainable legacy strategies through Will Writing partnerships, estate planning, training and supporter engagement.
- Legacy Management – providing specialist advice on legacy administration, estate management, tax, property and complex estate matters.
- Legacy Protection – supporting charities where disputes arise, helping them protect charitable gifts and uphold donors’ intentions.
Alongside these specialist legacy services, we also provide wider legal advice across areas including employment, property, governance and commercial matters, giving charities access to a coordinated legal service tailored to their needs.
Looking Ahead
The latest HMRC figures demonstrate that charitable giving remains strong and that legacy income continues to play an increasingly important role in supporting charities across the UK.
As more supporters choose to leave gifts in their Wills, charities have an opportunity to strengthen their legacy strategies, improve stewardship and ensure they have the right legal support and processes in place to maximise the benefit of every gift.
Our Charity Assist team help charities at every stage of the legacy journey—from helping supporters to include charitable gifts in their Wills through to administering complex estates and protecting gifts when disputes arise.
If you would like to find out more about how TE Charity Assist could support your charity, contact us on charityassist@tayloremmet.co.uk or 0330 390 7343.