There are occasions when dealing with an estate where a post death variation is required.
There are a number of reasons for this but the most common ones are as follows:
- The wishes of the deceased have not been fulfilled as they may have died before changing their Will;
- The beneficiaries wish to make gifts from the funds they receive from the estate and so, don’t want those gifts to impact their own estate; or
- There may be a trust in the deceased’s Will which is not tax efficient for inheritance tax purposes or indeed, is no longer required.
Considerations when varying an estate post death
When exercising post death variations, here are some factors to keep in mind.
- There is a 2 year window from the date of death to exercise any variation;
- If you fall outside the 2 year window, then the law is clear in that such a variation will be prohibited;
- Post death variations can often be enacted by a Deed of Variation which is particularly useful when a beneficiary wants to redirect their inheritance (in whole or part) to, say, a grandchild of the deceased;
- When collapsing a trust, make sure it is the right thing to do and work through it with a qualified person. Often, care planning needs to be considered and so bethis in mind;
- A beneficiary can disclaim their inheritance completely which means that they waive all entitlement to it. This can be done via a disclaimer although The Law Society’s guidance on this suggests you look to a Deed of Variation first; and
- As there is a large element of tax mitigation in a post death variation, make sure you seek the appropriate advice.
Post death variations should not be relied upon as it may not always be possible to enact the variation. Therefore, it is important that your Will is up to date.
Post death variations can be useful and are an important mechanism should the need arise.
If you have any questions regarding this area of law, which commonly falls within “Probate”, then please feel free to get in touch. My contact details are as below.