Kirk Douglas, actor, legend (no I’m Spartacus!) and improbable Inheritance Tax (IHT) mitigator.
I always think it’s a lovely touch to leave part of your estate to charity and in Kirk’s case that was a significant part indeed. The IHT regime in America is radically different to our own and most normal folk will never pay IHT there. To be considered for the honour, you have to gift away more than $11.58m (cumulatively during your lifetime and on death).
Canny Kirk has therefore probably done some careful estate planning, gifting $50m to charity (free of IHT) and the remaining $11m of his estate elsewhere (within his IHT allowance assuming he made no other large gifts).
In the UK, gifting to charities can also help lower your IHT bill. Such gifts are IHT exempt, and if you gift enough away, you will qualify for a reduced rate of IHT (36% rather than the normal 40%).
If you would like any assistance with your estate planning, especially if you wish to make a sizeable donation to charity or perhaps even establish your own charity, please do not hesitate contact any member of our Wealth Management and Taxation Team for further advice.