Generation Skip. Can Will Variations Help?

1 May, 2025 3 minutes reading time

Losing a loved one is a profoundly emotional experience. As you navigate the practicalities that follow, you might be surprised to learn that even after someone makes a Will, there’s a mechanism that allows its terms to be altered. This is a Deed of Variation, and beneficiaries can use it as a powerful tool to redirect their inheritance for various reasons, including tax planning and facilitating generational skipping.

For many, the initial distribution outlined in a Will might not be the most suitable outcome for those who survive. Perhaps circumstances have changed significantly since someone drafted the Will, or a legacy may benefit future generations sooner and more significantly. Whatever the reason, a Deed of Variation offers a legitimate and effective way to reshape an inheritance within a specific timeframe.

What is a Deed of Variation?

In essence, a Deed of Variation is a legally binding document that allows beneficiaries of a Will (or those entitled under the rules of intestacy if no Will exists) to change who inherits what from the deceased’s estate. It essentially rewrites the Will in part, as if the deceased had made those changes themselves before passing away.

The Golden Window: Two Years Post-Death

Crucially, you must execute a Deed of Variation within two years of death. This time limit is critical for its legal validity and potential tax benefits.

Why Draft a Deed of Variation?

A Deed of Variation offers beneficiaries valuable opportunities to reshape the distribution of an estate. For parents, it provides a route to pass on their inheritance directly to their children in a tax-efficient manner, treating the gift as if it were originally theirs and potentially shielding it from inheritance tax on the parent’s death. Beyond direct gifts, it allows for the creation of trusts, granting greater control and flexibility in how someone manages assets for future generations.

Beneficiaries can also leverage a Deed of Variation to support causes they care about by redirecting assets to charity, which can simultaneously reduce the inheritance tax that the estate pays.

Furthermore, this legal instrument can be a powerful tool for resolving family issues arising from a Will. If the Will has unintentionally left someone out, existing beneficiaries can use a Deed of Variation to include them, offering a way to avoid costly and emotionally draining legal battles.

Important Considerations

While a Deed of Variation offers significant flexibility, it’s essential to be aware of the following:

1. The terms are legally binding once you execute the deed, and you can’t easily reverse them.
2. While people often use variations for tax planning, it’s crucial to understand all the potential tax implications of a variation, including Income and Capital Gains taxes. Expert legal and financial advice is essential.
3. A Deed of Variation is a complex legal document that someone must draft correctly and execute properly to be valid.
4. It may not be possible to vary a Will or intestacy rules due to the circumstances of the parties, this may be due to age, disability, benefits, bankruptcy, etc
5. It is important to check whose consent is required for a variation.

Our Advice

Navigating the complexities of will variations and their implications can be challenging. Everyone’s circumstances are different. However, please contact us if you need further information or advice about an inheritance or making a Will. We are here to help.

Please note that all views, comments or opinions expressed are for information only and do not constitute and should not be interpreted as being comprehensive or as giving legal advice. No one should seek to rely or act upon, or refrain from acting upon, the views, comments or opinions expressed herein without first obtaining specialist, professional or independent advice. While every effort has been made to ensure accuracy, Curtis Parkinson cannot be held liable for any errors, omissions or inaccuracies.

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