Brexit is affecting the value of legacies, says Legacy Foresight

In its quarterly bulletin, the legacy consortium says growth in legacy income has slowed since summer last year

Wills: situation 'not perilous'
Wills: situation 'not perilous'

The vote to leave the European Union has begun to affect the value of legacies left to charities, the charity legacy consortium Legacy Foresight says.

In its quarterly bulletin, published today, Legacy Foresight says that growth in legacy income for charities has slowed since summer last year.

Growth in legacy income was "fairly flat" in 2015, but in the first half of 2016 it began to grow strongly from £1.3bn to £1.4bn, before tailing off, according to figures from the 83 members of Legacy Foresight’s research consortium, which represent more than half the UK charity legacy market.

The bulletin says the slowdown could be due in part to the uncertainty the vote to leave has brought to the UK economy: in cases where charities have been left a percentage of an estate, or whatever is left over after other beneficiaries are paid, the legacy gift is worth less, it says.

"Many UK economic indicators are now starting to slow as Brexit negotiations finally get under way," the bulletin says.

"This is having a slight impact on residual legacy values. In the year to March 2017 average residual values rose by just 3.4 per cent to reach £58,600."

However, the bulletin says the number of legacy gifts increased by 3.6 per cent in the year to March 2017 because of rising death rates. Total income was up by 6.3 per cent on the year before to £1.43bn, from 53,800 bequests.

The bulletin says: "Looking ahead over the next five years, we are not expecting a fall in legacy incomes, even in real terms.

"The economic situation is not nearly as perilous as it was at the start of the global crunch in 2008. And at the same time, numbers of legacies will continue to be underpinned by the rise in deaths. But we don’t expect the high growth rates seen in 2014 and 2016 either."

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