Charities face £1.5bn shortfall as fewer people donate in wills

UK charities could face a £1.5bn funding shortfall after a sharp fall in the number of people leaving money to good causes in their wills, according to new analysis from wealth manager Rathbones.

The proportion of adults with a will who have included a charitable gift fell to 31% in 2025, down from 46% the previous year. Based on comparable estate values, Rathbones said the decline could reduce legacy income from an estimated £4.5bn in 2024 to about £3bn this year.

The figures come as charities enter the run-up to Christmas, a period often associated with higher levels of giving and increased discussion of wills and legacies among families. The research also found that more than half of UK adults – 52% – have not yet written a will.

Charities have already faced a drop in other forms of support. Previous Rathbones research has pointed to falls in both donations and volunteering, adding to financial strain across the sector.

Legacy income remains a significant component of charity funding. The Legacy Giving Report 2025 estimated that a record £4.5bn was received by charities last year, largely because probate backlogs were cleared. It said gifts left in wills account for an average of 30% of fundraising income among the UK’s top 1,000 charities.

Despite the expected decline in legacy income this year, the study found no change in longer-term intentions. Around 30% of people who plan to write a will in future said they expect to leave a gift to charity, the same proportion as in 2024.

The research also highlighted the scale of potential future giving. More than one in eight people who have already included a charitable gift in their will plan to leave £50k or more. Among those intending to write a will in the next three years and include a charity, about 16% said they would give at least £10k.

Large numbers of adults remain without a will. The proportion rose to 61% among those aged 45 to 54, while 17% of people aged 65 and over also said they had not made one. Of those without a will, 38% said they plan to write one within the next three years.

Charitable gifts left in wills are exempt from inheritance tax. Estates that leave at least 10% to charity can also qualify for a reduced inheritance tax rate of 36%, down from 40%.