Various dumb questions re intestacy please..

theartfullodger

Dumb questions in an area I don’t know. Grateful for any comments or suggestions, feel free!

Brother dies Dec 2020, 80+, intestate as far as we know, not Covid, in England, (solicitor searching via Certainty Will , times up on that soon) and we (me, + 1 remaining other sibling) will be inheritors/executors (Yes assuming no genuine will found??).

Likely estate value some £180k – (house less ludicrously expensive “equity release” scheme/scam he’d signed up to). So presumably no IHT to worry about.

We know he wanted to leave various £££ to various charities & we plan to honour those wishes as we understand them. Are there any advantages to trying to (is this legal?) gifting direct from estate, or does it have to go via inheritors, please??

If OK to make donation direct from estate, is there something similar to gift-aid? Otherwise clearly better for us to inherit the money then donate in our names with gift-aid uplift.

Finally, I’m considering giving some £££ fairly immediately to my sons/grand-kids. Any advantages doing it from me or from the estate.

Apologies if these questions are dumber than my usual…

Best wishes to all.

Rodders53

Charity donations from Estate can reduce IHT due, but there is none due at the figure you mention.  Gift Aid from the Estate? No. (google tells me).  So your plans to inherit and gift aid donations works best (within your taxable income limits, of course).

Passing money direct to your descendants (via Deed of Variation) will ensure that cash doesn't count towards your IHT bill in the future - although it will also fall out after 7 years from the gift.  (But if you only have assets under the IHT threshold then there's little point in the DoV).

thegreenone

Do NOT give any money to anyone until Probate or Letters of Administration are granted.  Do you have exact figures from the equity release company?  They need their money first.  Solicitors fees. Charities. All from the estate money.  Once all debts/bequests have been paid, then you can distribute the remainder.  Only then.

theartfullodger

Rodders53 said:

...........  So your plans to inherit and gift aid donations works best (within your taxable income limits, of course).

.................

Thanks Rodders, great stuff!  Didn't know there were taxable limits for gift aid: Do you know what it is & how it works, please???

Keep_pedalling

theartfullodger said:

Rodders53 said:

...........  So your plans to inherit and gift aid donations works best (within your taxable income limits, of course).

.................

Thanks Rodders, great stuff!  Didn't know there were taxable limits for gift aid: Do you know what it is & how it works, please???

Gift aid can only be paid up the the value of tax the giver has paid in the tax year of the gift. Charities cannot claim gift aid cannot claim it if the giver is not a tax payer. If you are a tax payer then the charity will be better off if you pay them rather than the estate, providing you pay enough tax to cover the gift aid. So for example you gift a total of £10k then you will have had to pay £2k in IT to cover that (10%)

poppystar

Keep_pedalling said:

theartfullodger said:

Rodders53 said:

...........  So your plans to inherit and gift aid donations works best (within your taxable income limits, of course).

.................

Thanks Rodders, great stuff!  Didn't know there were taxable limits for gift aid: Do you know what it is & how it works, please???

Gift aid can only be paid up the the value of tax the giver has paid in the tax year of the gift. Charities cannot claim gift aid cannot claim it if the giver is not a tax payer. If you are a tax payer then the charity will be better off if you pay them rather than the estate, providing you pay enough tax to cover the gift aid. So for example you gift a total of £10k then you will have had to pay £2k in IT to cover that (10%)

As gift aid is 25p in £ then that should be £2500 for a £10000 gift surely? 

Paying enough tax to qualify for Gift Aid

Your donations will qualify as long as they’re not more than 4 times what you have paid in tax in that tax year (6 April to 5 April).

The tax could have been paid on income or capital gains.

theartfullodger

Sadly, not a problem with my income tax.  Thanks folks.