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What's New? > News & Press Releases > Where there is a will...

23

May 13

Where there is a will...

By: Daniel Whiddett

Daniel Whiddett

Whilst the preparation of a will provides peace of mind for the person who makes it, it is possible to vary the distribution of the estate after the death.

A document known as a Deed of Variation is required in order to record the alterations to the will. This must be completed and signed within two years of the date of death.

The beneficiaries of the will who are altering their inheritance must consent to this and in certain circumstances (e.g. where children are involved) the approval of the court must be obtained.

It is also good practice for the executors to sign the document. If the inheritance tax payable by the estate is affected by the variation, then the document must be recorded with HM Revenue & Customs.

A Deed of Variation could be a useful tool if the inheritance tax liability is reduced or eliminated.

It may also be appropriate for a beneficiary to pass their assets to, by way of example, their children by this method.

This would reduce the beneficiary's estate for inheritance tax purposes and because of the special rules that apply this would avoid them having to survive by seven years in order for the value of the assets to fall outside of their estate for inheritance tax purposes.

A Deed of Variation could also be utilised to settle any claim a third party has against the estate, where all of the parties agree and therefore potentially save thousands of pounds in costly litigation.

In summary, a Deed of Variation is a useful tool but you should not be put off making a will. A will is important and Deeds of Variation are generally utilised only in certain circumstances and are therefore exceptional and not the norm.

This article aims to supply general information, but it is not intended to constitute advice. Every effort is made to ensure that the law referred to is correct at the date of publication and to avoid any statement which may mislead. However, no duty of care is assumed to any person and no liability is accepted for any omission or inaccuracy. Always seek our specific advice.