Deeds of Variation – can a will be changed after death?

20 January, 2022

Under current rules in England and Wales, you can redirect your inheritance to another person in certain circumstances.

A Deed of Variation is a formal document in which you can state that your inheritance should not come to you but should pass to someone else that you choose.

This has advantages for inheritance tax (IHT) purposes. If you receive the inheritance and then pass it on to your chosen recipient, you are treated for IHT purposes as making a gift. This means you have to survive 7 years for the value of that gift to fall out of your own estate for IHT calculation purposes. If you die within 7 years of making that gift IHT may be payable.

By making a Deed of Variation, you are treated for IHT purposes as if you have not made a gift. The variation is “read back” into the deceased person’s Will as if the inheritance went directly from the Will to your chosen beneficiary.

The executors of the deceased person’s estate, do not usually have to agree or be involved in signing the Deed. Only the person who is “giving up” their inheritance must agree to and sign the Deed of Variation.

By making a Deed of Variation you are redirecting your inheritance, for example, to the next generation (your children) for your own IHT planning purposes. To be effective for IHT purposes the Deed of Variation must be completed within two years after the death of the person you are inheriting from. Specific wording must be included in the Deed itself to qualify for these IHT benefits.

For further information about Deeds of Variation, Inheritance Tax Planning, Estate Planning, Wills and Trusts please contact Gill Knowles on 01244 400567 or email: gillian.knowles@storrarcowdry.co.uk

This article provides general advice only, based on HMRC rules at the time of publication and does not constitute specific legal advice.