Changing a will after someone has died: it is possible and it could save you money
Sometimes the generosity of a friend or relative leaving you a gift in their will can backfire if it turns out your estate will need to pay tax on it or if there is a chance that it could be swallowed up in future care costs or in satisfying some other type of claim. It may also be the case that a will prepared many years ago does not take advantage of new tax allowances on death, such as that which now applies when you leave a share of your home to your children or other descendants.
To cater for these sorts of situations it may be possible for the provisions of a will to be varied to better suit your needs or to ensure tax efficiency where possible. Deborah Adams, Director and Head of Private Client with Parnalls Solicitors in Launceston explains more.
‘If you have been left a gift in someone’s will and you are worried that as a result the value of your own assets when you die may be pushed above the rate at which inheritance tax becomes payable, then it is a good idea to talk to a solicitor about the possibility of varying the will to divert your inheritance to someone else.’
‘It is also advisable to seek advice’, says Deborah, ‘if you are starting a new relationship and are anxious to protect your inheritance in case the relationship breaks down, or if you and others named in the will are keen to make provision for people not currently provided for, such as grandchildren of the deceased who were born after the will was prepared.’
How can a will be varied?
To bring about some changes, such as to benefit someone who is not currently named in the will, you can simply give away some of your inheritance. However, before doing this you will need to consider whether there could be any adverse tax consequences, such as liability for inheritance tax arising under the potentially exempt transfer rules if you die within seven years of the gift being made.
The other option to effect a change is via a formal legal document, known as a deed of variation. Which option is right for you will depend on the circumstances but there are formalities that need to be complied with for a deed of variation to be effective.
To avoid any adverse inheritance or capital gains tax implications, a variation will need to:
• be made within two years of the deceased person’s death;
• be recorded in writing;
• make it clear how the will is being varied, ie the nature of the gift you are foregoing and who you are passing it on to;
• be signed by you, as the original beneficiary; and
• not involve any reward from your point of you, ie not be made in return for you receiving some other benefit in lieu of you giving up some of your inheritance.
It is important to take legal advice to ensure all formalities are complied with, particularly where the variation is to be made by deed given that arrangements cannot subsequently be changed.
Who can make a variation?
It is possible for anyone who stands to benefit under the terms of a will to seek a variation. It is also possible in some situations for the executors or personal representatives of the deceased person to suggest a variation is made. There are additional requirements where the variation being considered will increase the estate’s tax liability or where beneficiaries under the age of 18 will be affected.
What about intestate estates?
If you stand to inherit under the intestacy rules because your relative failed to make a will, then it is still possible for you to make a deed of variation to give away some or all of your inheritance to someone else.
Can I just refuse to accept my inheritance?
Whether you have been left an inheritance through a will or the rules of intestacy you are entitled to decline to accept it but if you do this you will have no right to then dictate who should benefit instead. If you are uncomfortable about this then it might not be the way to proceed.
Please note that the Goverment reviewed the Deeds of Variation in 2015 so these guidelines may not be around forever so act now.
If you have received an inheritance which you are not sure you want to accept, or if you have some other reason for wanting to vary the terms of a will or the rules of intestacy, please contact Deborah Adams, Director and Head of Private Client with Parnalls Solicitors in Launceston on firstname.lastname@example.org or call 01566 772375 for advice on your options.
Buying the freehold of your leasehold house
Redeveloping an empty pub for commercial use
Why it takes time to obtain the Grant of Probate
Social Media: The unconscious privacy threat
Is your reputation being threatened?
Making a will after your spouse or partner has died
Interns celebrate completion of internship at solicitors
Selling your home in a flat market, some top tips
Claiming compensation for a serious road traffic accident
New Media and Communications Court list reflects surge in internet defamation claims by Laura Baglow
Has your personal information been shared without your permission?
Planning your escape to the country, what you need to consider – part 2
Government consultation on new national model for shared ownership
Choosing a partnership structure
Planning for what happens when you die by Deborah Adams
Changes to legislation could offer protection for tenants in the private rental sector
Move to the country - Part One
The risks of DIY probate
Will your septic tank still be legal in January?
The death knell for ‘kiss and tell’?
Making a will when you retire
Selling your property at auction
Not looking so good - your guide to compensation for botched non-surgical cosmetic procedures
New threshold of seriousness in defamation proceedings
Legal considerations when building a granny annex
Choosing the right person for your power of attorney
Formal Interviews - Do you need legal representation?
Privacy rights and aerial images
Trustees’ duty to give information to beneficiaries
Five problems with a leasehold property
Taking your first commercial lease
Is your organisation protected from employee social media legal risk?
Have you been targeted by negative social media posts?
Farmers be alert when being inspected
Help for House Sellers?
Don’t let your digital assets end up in a digital grave
Valuing an estate for probate
Development proposals and your local authority search
What can you do if your child is injured in a serious accident
NetRights welcomes new protection for social media users
SHOULD I GET A LAWYER FOR A SPEEDING OFFENCE?
Supreme Court recognises that social media is a “casual medium” in libel battle
Choosing the best conveyancer who is right for you
Making a will after a second or subsequent marriage
Option or promotion agreement – which is best for landowners?
Anonymous pub and restaurant online reviews leave a bad taste
Have you had an accident involving a horse?
Help to Buy – beware of some cracks in the structure
Understanding Lasting Powers of Attorney
Changes to Energy Performance Certificate for Landlords
Had a cycling accident? Your route to obtaining compensation
New year, new home: tips to sell your home in the New Year
Tax Planning for your inheritance
Hearing loss: when your employer may be liable
Buying a home for your retirement, five things you need to consider
Farmers plan to diversify after Brexit
Ministers press ahead with probate fee shake-up - reports BBC News
Botched dental treatment? You may be entitled to compensation
Why a Health and Welfare Power of Attorney is a good idea
Will the new charge on building developments in Cornwall affect you?
Energy Performance Certificates – Do They Matter?
HMRC Challenging Stamp Duty Land Tax Payments
Ben Mitchell qualifies as a solicitor
The potential implications of Brexit on employment law
Appointing a guardian for your children
Houses in multiple occupation – new rules from October 2018
New Agriculture Bill published
Will Brexit affect my pension?
Dreaming of a holiday home? Sort out the legals before putting your feet up
Lasting Power of Attorney by Deborah Adams
Settled status after Brexit by Alexis Hager
How to choose an executor to administer your estate when you die
How overage agreements can boost profits from your land
Top tips for first-time buyers
How Could Brexit Affect My Farm?
Wills & Succession in Spain by Deborah Adams
Brexit – an international and local view by Alexis Hager, Litigation
Capital gains tax - important facts for non-residents of the UK
Buying a home: the importance of making sure the seller is entitled to sell
Changing a will after someone has died: it is possible and it could save you money
Your responsibilities when you have people working in your home
Sad passing of Battle of Britain pilot who served with Parnall family member
Considerations when buying a heritage property
Disciplinary proceedings at work: guide for employers
Employers should have a disciplinary process in place, but just following this may not be enough to avoid falling foul of the law and exposing yourself to the risk of an employment tribunal claim.