This information is for general guidance only. The University of Cumbria cannot offer legal or financial advice or provide recommendations for solicitors. In all cases, we strongly advise that you seek independent professional advice when drafting a new Will or updating an existing Will.
University’s Tax Status – The University of Cumbria is a company limited by guarantee (registered company number 06033238) and is also an exempt charity under the terms of the Charities Act 2006 and is exempt from Income Tax and Inheritance Tax under present legislation.
Inheritance Tax Threshold - Inheritance Tax is the tax imposed on the estate of a person whose permanent residence was in the UK. The tax threshold and rate of tax are usually reviewed annually by the Chancellor of the Exchequer and implemented with effect from 6 April at the start of each new tax year. If your estate is worth more than the nil-rate band, currently set at £325,000 for individuals at the time of your death, your estate may be liable for Inheritance Tax at the rate of 40% on all your assets above the nil-rate band. This applies to all your assets, including your house. Remember that each party to a marriage or Civil Partnership has their own nil rate band. This provides a combined tax free allowance of £650,000.
One way to limit your estate’s exposure to Inheritance Tax is to leave a legacy to an institution with charitable status such as the University of Cumbria. Leaving a legacy of at least 10% of the value of your estate will reduce the rate to 36%. The legacy is free of tax, i.e. its value is deducted from the total assets of the estate liable for Inheritance Tax.
Further information is available from the HM Revenue & Customs or alternatively through their website on www.hmrc.gov.uk.
Is there a place for the University of Cumbria in your Will?
Making a Will is one of the most important things that you can do. It ensures that, after you are gone, your assets are distributed accordingly to your wishes amongst the family, friends or organisations that have been important to you during your life. It is advisable to consult a solicitor to make sure that your wishes are legally valid.
When considering a legacy, there are not only different types (see below) but also different purposes. “Unrestricted” or “general purpose” legacies allow the University to support its areas of greatest need, now or in the future. We do appreciate that you might wish to stipulate particular areas for support, in which case we invite you to discuss this with us to ensure your wishes can be met.
You can help to shape the future and we will provide assistance in guiding your decision, for example:
- You can establish a scholarship or bursary to support more of the most talented students, or help those who might not otherwise come to university because of financial pressures.
- You can support world-changing research that pushes the boundaries of knowledge further to find new solutions to the challenges of health and well-being, business and the environment.
- You can invest in the development of the University estate to provide modern, accessible and environmentally friendly space for the growing student population.
- You can provide development and internship opportunities for a diverse student population and help young people to reach their full potential, be better able to secure employment and make a positive contribution to society.
For some, especially for University staff, an endowment offers a means of carrying on the work they have been committed to in their lifetime. For some an endowment is a means of funding new work in the future. If this is the case you might also wish to consider how that work might be started during your lifetime, so enabling you to enjoy as fully as possible the benefits your gift brings to others.
Types of Legacy Gift
Gifts can be made in several ways; in the form of money, property or other valuables, such as stocks and shares or works of art. The main types are described below with suggested wording:
A residuary gift is stated as all or as a percentage of your remaining estate, after all fees, outstanding costs and other gifts have been deducted. The advantage of a residuary gift is that it keeps track with inflation as it is not a fixed sum.
A pecuniary gift is a fixed sum of money. As gifts of money can lose value from the day the Will is made, unless they are index-linked, it is preferable to allocate a percentage of your residuary estate to the University (see above).
A reversionary gift is an excellent way of both providing for family or friends and benefiting the University. It involves leaving assets to a chosen beneficiary to use during their lifetime, with the whole or a portion reverting to the University if none of your named dependants survives you.
A legacy need not be in the form of money. Specific gifts in the form of stocks and shares, land and property, works of art or other valuables can also be bequeathed.
A conditional gift in your Will addresses the possibility that you may survive all of your main beneficiaries or dependents. By including substitute or default beneficiaries it would ensure that, in this event, your estate would be left to the University or any other beneficiaries that you name.
How to update your Will
Simple alterations can be made to your Will by means of a supplementary document known as a Codicil. A Codicil confirms your original Will but also adds to it. A solicitor can advise you whether a Codicil will be appropriate or if your Will needs to be re-drafted in full.
Legacy Notification Form
If you decide to support us with a gift in your Will, please let us know by completing and returning the Legacy Notification Form. It is really helpful to the University to know how our supporters are planning to help, and it a real pleasure to be able to thank you now for the gift you have planned and to provide you with the opportunity to participate in the activities of the University as publicly or privately as you wish.