Inheritance tax and charity exemptions
As a registered charity, any gift left to Shelter is normally exempt from inheritance tax (as per s.23 of the Inheritance Tax Act 1984).
Where more than 10% of an estate has been left to charity, the 36% reduced rate of Inheritance Tax applies. Where less than 10% has been left to charity, it may also be possible to vary the terms of the will to benefit from the reduced tax rate at no expense to other beneficiaries.
When apportioning any tax payable, please consider s.41 of the Inheritance Tax Act 1984 and the associated case of Re Ratcliffe deceased [1999] All ER (D) 167.
Capital gains tax
If the value of any asset has increased since the date of death, it may be possible to mitigate any potential capital gains tax liability. You can do this by appropriating it before the sale to any charitable beneficiaries.
Income tax reclaims for charitable beneficiaries
Shelter can reclaim any tax paid on our share of income received during the estate administration. To allow us to do this, please provide us with a completed R185 (Estate Income) form for each year in which a distribution is made.
Managing shares and investments
Shelter does not normally take shares or investments in specie. We would be grateful if you would arrange to sell these during the estate administration.
Managing chattels
Our network of charity shops may be able to assist with these items. We may also be able to negotiate reduced commission rates with some of the large auction houses so please do get in touch.
Valuing and selling property
Please obtain two or more property valuation reports from independent estate agents or qualified surveyors before marketing a property for sale. And do not forget that any increase in value could affect the potential capital gains tax liability.
Tenanted properties
If there are any tenanted properties, please do let us know. As a housing and homelessness charity, we always want to make sure that tenants are appropriately supported