Make a Lasting Impact While Reducing Your Inheritance Tax
A New Tax Reality: How Changes in UK Inheritance Tax May Affect You
Discussions around inheritance tax (IHT) in the UK have been making headlines recently. Changes set to take effect from April 2027 could mean that more estates become subject to IHT, potentially reducing the wealth passed on to loved ones. However, by including a gift to Children of the Mekong in your Will, you can not only support a meaningful cause but also reduce your tax rate by 4%.
What’s Changing in Inheritance Tax?
Inheritance Tax is a levy on a deceased person’s estate, which includes their money, property, and possessions minus any debts. Currently, pension schemes, including Self-Invested Personal Pensions (SIPPs), are not included in taxable estates for IHT. However, from April 2027, unused pensions will likely become part of a person’s taxable estate, making it more likely to exceed tax-free thresholds and be liable for IHT.
At present, estates valued below the ‘nil-rate band’ (£325,000) and the ‘residence nil-rate band’ (up to £175,000 when passing on a family home) are not taxed. However, any value exceeding these thresholds is taxed at 40%. Additionally, estates exceeding £2 million begin to lose residence nil-rate band entitlements. Once pensions are included in taxable estates, more families will be affected by IHT than ever before.
How Can a Legacy Gift to Charity Benefit You?
The good news is that gifts and legacies left to charities like Children of the Mekong are entirely exempt from IHT. Even more compelling, leaving at least 10% of your taxable estate to charity reduces the overall IHT rate from 40% to 36%. This means your generosity can benefit not only a cause you care about but also your family’s financial future.
By leaving a gift in your Will, you can create a lasting impact, supporting vulnerable children and their education while reducing your tax burden. It’s a win-win situation: your legacy contributes to meaningful change while helping you make the most of the wealth you leave behind.
Why Choose Children of the Mekong?
Since 1958, Children of the Mekong has been committed to transforming the lives of disadvantaged children in Cambodia, Laos, Myanmar, the Philippines, Thailand, and Vietnam. Our mission is to provide education, support, and training to empower children and lift them out of poverty.
Many families we support live in extreme poverty, struggling to afford basic necessities, let alone education. Sponsorships and donations help fund school fees, essential resources, and secure accommodations for children who would otherwise miss out on an education.
How Your Legacy Gift Makes a Difference
Some children face additional barriers to education—distance from schools, unstable home environments, or the loss of a parent. To support them, Children of the Mekong operates education centres and boarding houses. However, running these centers comes at a cost. For example, our Samrong Education Centre in North Cambodia requires £60,000 annually to support around 70 students pursuing secondary education.
Legacy donations are crucial in keeping our centres running, expanding our reach, and opening new facilities for children who desperately need education and support. Your gift can provide a child with the chance to go to school, secure employment, and build a brighter future for themselves and their community.
‘My relationship with the charity Children of the Mekong began when I visited a close friend of my mother’s, who was the sponsor of a little Cambodian girl. There was a copy of the charity’s newsletter at his house. We discussed the work of the organisation. I then decided to help a child in my turn and to follow its progress.
In 31 years, I have helped 14 children from Southeast Asia, and two other sponsorships are in progress. At the same time, I have also taken a great interest in these countries, particularly Cambodia. I was very moved by the population movements and the fate of Cambodians who took refuge in camps in Thailand between 1970 and 1990. My desire to support the children of this country and my knowledge of the historical and political context have fed off each other.
I have been thinking about my succession for more than five years. I was fortunate enough to have a decent standard of living and a comfortable retirement, but I did not have an heir. Of Catholic culture but non-believing, I would like my life insurance to be used to build something and for my legacy to be useful to future generations after my death.
It would be the continuation of my commitment to Children of the Mekong. I have absolute confidence in this organisation thanks to its long experience and good management of funds, hence my loyalty and continued commitment to it. Thanks to my gift, if I give a substantial sum, and with the purchasing power differential with here, a primary school will open somewhere in Southeast Asia.’
Leave a Legacy That Changes Lives
Your Will is more than a legal document—it’s a reflection of your values and the impact you want to leave behind. By choosing to include Children of the Mekong, you ensure that children in some of the world’s poorest communities have the education, care, and opportunities they deserve.
Get in touch
If you’d like to learn more about how leaving a gift in your Will and transform lives, please contact us. Let’s work together to create a legacy of hope and opportunity for future generations.
