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At Legacy Link our mission is to help charities grow with legacy giving, and we are proud to support around 120 charity clients each week through our legacy administration service.

One of the myths of legacy administration, is that it is simply an administrative process.

But good legacy administration is an art as much a science, and requires excellent communication, tenacity, detective skills, as well as a good grasp of the legal landscape.

Do it well and you will improve your charity’s reputation, reduce any potential risk, speed up the time to payment, and even increase the amount you receive.

Last year, Legacy Link helped its charities to collectively receive over £200m in legacy income, and an estimated £10m of this was in added value.

Here the team share their top tips for how to add value through the legacy administration process, and share some real life examples from successes this year.

We are often asked, how to increase the value of legacy gifts through the administration process, and the answer isn’t a secret! There are many ways to do this, not all of which will be possible on each case, so it needs a thorough understanding of all the options:

  • Ensuring you identify all the assets, sell for the best price, and minimise any costs in doing so
  • Getting the most appropriate expert support from solicitors, agents, valuers and making sure you pay a fair price
  • Reducing the amount of tax the estate pays, meaning there is more for every beneficiary
  • Correcting errors in estate accounts (you will be surprised how often the numbers don’t add up!)
  • Pushing back on spurious legal claims
  • And more besides

Here are some examples of how we have increased the value of some of our charities legacy income this year.

Defending entitlement against a claim

Most noteworthy, Paul Browne our new Head of Legacy Administration successfully defended two contented cases for the same charity which resulted in securing a significant legacy gift. Paul’s experience and tenacity led him to encourage the charity to defend this claim even when the charity expressed doubt. As a result, the charity received payment of £4.2m that they otherwise wouldn’t have received.

Applying the right inheritance tax band

In another very recent case our consultant, Brad Greis, spotted that a solicitor had applied the wrong nil-rate tax band on an estate. This meant that an extra £325,000 to the estate that was shared equally between four charity beneficiaries, including £65,000 to our charity client.

Small amounts add up

It should be noted though that not all added value examples are on this scale. At a smaller, but still important level, we do have many examples where our consultants will challenge fees. One of our consultants experienced this recently when a solicitor advised that they were able to make an interim distribution from the estate, but they would charge £47 to send a cheque. She challenged this politely and enquired whether payment could be made by BACS instead, they agreed and did this free of charge. It all counts as money going back to the charity.

Working with partners to sell a property

We have also been able to use our partner network to help the charities we are working with. An example from an estate earlier this year where the solicitor was struggling to sell a property that had major damp, roof issues and was in general disrepair. We were able to work with a national online auction company who sold the property for £28,300 more than the section 119 valuation – with no estate agency fees payable to the estate.

The right guidance on an indemnity

Another consultant, Marcia Prince, reported that a Trust was being dissolved as many charity beneficiaries were upset about an indemnity clause they were being asked to sign.  In this situation the Trustees were entitled to an indemnity as they are dissolving the will Trust and so their request was reasonable.  At the same time the Trustees have adequate processes for dealing with the liquidation so there was little overall risk to the charity of signing it.  Marcia advised our charity partner to sign it and they agreed.  Some charities who refused the indemnity have since had their benefit reduced to a set sum of money (£20-30k), while ours had its benefit increased from 8% to 18% on the net proceeds of the sale of three farms.

Improving charity processes

We have other examples where our consultants have stepped in to challenge charity processes and have been able to prevent potential tax inconsistencies as gifts are recognised as donations rather than legacies. We have even questioned a potential final distribution which was more than we were expecting – it turned out that the solicitor had miscalculated the final amount and were about to significantly overpay all the beneficiaries. This attention to detail saved a lot of trouble further down the line when the monies would have been reclaimed and needed to be paid back.

These recent examples represent just some of the on-going efforts that our consultants apply each and every day, adding value and going above and beyond for our charity partners.

Sharon Wheeler

Want to know more

For more information about the ways we could support your team please contact Sharon Wheeler