what is a deed of variation? | Read Time 2-4 Minutes.
We’ve all heard the phrase “last will and testament.” But did you know that the wishes in someone’s will could still be changed after they pass away?
If you want to change the portion of an estate that is left to you in someone’s will, you can use a deed of variation. Deed of variation is also a term that is applicable to changing a leasehold property. However, this article will use the term in relation to wills, probate and estates.
What is a deed of variation?
In short, a deed of variation is a document that allows any named beneficiaries in an estate to change what happens to their portion of that estate. This means the beneficiaries can apply to deviate from the original outlining of the will. The deed can also help minimise the inheritance tax due on an estate by gifting a portion of the estate to someone else.
When might I need One?
There are many instances in which you may need a deed of variation. Some of the main reasons might include:
- You don’t need all of your share of the estate and think someone else may benefit from it.
- You would like all or some of your inheritance to go to charity.
- The deceased wrote the will before the birth of new family members who may need to inherit from the estate.
- There are discrepancies in the will, such as certain family members inheriting more than others, which you would like to even out.
A mother and son are named as the beneficiaries of their father’s will. However, the mother inherits a significantly larger amount than her son. In this case, the mother can use a deed of variation to reduce her share of the estate and give an amount that she chooses to her son.
How do I make a deed of variation?
You won’t need to fill in any large of official forms to create your deed. In most cases, it will be a written document, the length of which depends on it’s exact contents. Despite sounding easy, your deed will need to comply with a list of criteria laid out by the government, which you can find here.
Does a deed of variation need to be registered?
A deed of variation doesn’t need to be officially registered because the signatures from all of the beneficiaries are enough to make the deed binding.
frequently asked questions
who can sign the deed?
For a deed of variation to become valid, it needs signing by all of the executors of the will and any beneficiaries who may be affected by the changes made.
How long does the process take?
You have two years from the date of death to complete a deed of variation. You can complete a deed of variation before or after probate.
does a deed of variation avoid inheritance tax?
We can’t say that your deed “avoids” inheritance tax. However, your deed can help to reduce the amount of inheritance tax payable on the estate, because it will outline that some portions of the estate are gifts. It can also help to minimise any inheritance tax liability that may arise from a beneficiary’s death.
How much does a deed of variation cost and who pays for it?
The person making the change will always be the one paying for the deed. The cost will depend entirely on what needs to go into the deed and what changes are required. Usually, our partners usually advise that it will cost between £1,000 – £1,500.
Do you need a lawyer for a deed of variation?
Whilst you don’t necessarily need a lawyer to write your deed, it will always be in your interests to have one. Wills, probate, estate management and inheritance tax are particularly complex areas of law, and you could find yourself being penalised if your deed is drafted incorrectly.
Our partner firms are SRA regulated and have expertly trained private client teams who handle everything wills and probate. If you need our help with a deed of variation, get in touch today and we’ll connect you with one of our LGBT Partners.