11 July 2013

Deeds of Variation - Changing Someone's Will

It's not commonly known but it's possible to change the contents of someone's will after their death.

Why might you want to do that? Well, tax is the reason very often - Inheritance Tax (IHT) generally. Here's a couple of examples.

Perhaps the children of the deceased already have plenty of assets of their own, and an additional substantial gift will simply add to their own IHT problems. So skipping a generation and passing assets to grandchildren might be preferable.

Or if there is a surviving spouse it may be better to leave assets to them (with no IHT payable) rather than pass it to others where there would be. And if that surviving spouse is young enough there may be scope for using their own allowances to gift the assets over a period of time.

Deeds of variation must be executed within two years of the death.

As ever with IHT, there is often scope for large tax savings, but advice is needed to avoid the pitfalls.

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