It is a common misconception that once a person passes away, their Will is set in stone however, the UK law allows for there to be flexibility through a Deed of Variation (sometimes referred to as a Deed of Family Arrangement).

Following the death of a loved one, their estate is distributed according to the terms of their last valid Will (or under the Intestacy rules if no Will exists). However, circumstances change, and sometimes the distribution mentioned in the Will is no longer what the beneficiaries wish to proceed with.

Beneficiaries are able to alter their entitlement through a Deed of Variation and make changes to the distribution of the estate. There are many reasons why some may want to make these changes. This could be to achieve a more tax efficient outcome, provide for someone who was left out of the will, moving the deceased’s assets into a trust (usually for their longer term protection) or simply clearing up any uncertainty within the Will itself.

If you are considering a deed of variation, then this should be done within two years of the date of death in order for there to be an inheritance or capital gains tax benefit. If you miss the two-year deadline, the deed of variation can still be executed and will still be deemed valid but would not have access to this tax benefit.

It is imperative that the Deed of Variation be drafted with correct statutory references otherwise the potential tax benefits will be lost. We therefore recommend seeking an experienced legal representative to handle this on your behalf.

If you would like to discuss this further, please feel free to contact any member of our Wealth Management & Taxation Team on 01494 521 301.