Beneficiaries may redirect their inheritance through a Deed of Variation, often for tax planning or family reasons, while certain family members or dependants may challenge a Will under the Inheritance (Provision for Family and Dependants) Act 1975 if they believe they have not received reasonable financial provision. Although disputes can arise where relatives are excluded or treated unequally, careful estate planning, regular Will reviews and a Letter of Wishes can help clarify intentions and reduce the risk of challenges to the estate.
Can my family change my will after i die?
Many people assume that once a Will has been signed, their wishes are fixed and cannot be changed after their death. Whilst a valid Will remains an important expression of a person’s intentions, there are circumstances in which the distribution of an estate may be altered after death. This can come as a surprise to individuals who believed their estate would pass exactly as set out in their Will.
Can a will be changed after death?
In some circumstances, yes. Beneficiaries may choose to redirect all or part of their inheritance through a Deed of Variation. Provided certain legal and tax requirements are satisfied, this can alter the way assets pass following a person’s death.
Deeds of Variation are commonly used for tax planning purposes, to provide for family members who may have been overlooked or where beneficiaries wish to redirect assets to future generations.
The role of deeds of variation
A Deed of Variation enables a beneficiary to redirect all or part of their entitlement under an estate. Where the statutory requirements are satisfied, sections 142 Inheritance Tax Act 1984 and 62(6) Taxation of Chargeable Gains Act 1992 allow the variation to be treated for Inheritance Tax and Capital Gains Tax purposes as though it had been made by the deceased.
This can create valuable planning opportunities. Common examples include redirecting assets to children or grandchildren, utilising available tax reliefs more effectively or introducing trust structures where additional asset protection may be desirable.
To obtain the relevant tax treatment, a Deed of Variation must generally be executed within two years of the date of death and contain the appropriate statutory elections.
Although they can have beneficial tax effects, the changes made by a Deed of Variation are still gifts by the original beneficiary. As such they may not help with care fees planning or insolvency.
What if someone believes the will is unfair?
Certain individuals may be entitled to bring a claim under the Inheritance (Provision for Family and Dependants) Act 1975 if they believe reasonable financial provision has not been made for them.
Claims for reasonable financial provision
The Inheritance (Provision for Family and Dependants) Act 1975 provides a mechanism by which certain categories of claimant may seek financial provision from an estate where a Will, intestacy or lifetime arrangements fail to make reasonable provision for them.
Potential claimants may include spouses, former spouses, cohabitees, children and individuals who were financially dependent upon the deceased immediately before death and feel the Will of the deceased does not adequately reflect the relationship they had.
When considering such claims, the court may take into account a range of factors including the financial resources and needs of the parties, the size and nature of the estate, any obligations owed by the deceased and, in some circumstances, the conduct of those involved.
The court has wide discretion and may order the payment of lump sums, ongoing maintenance, property transfers or the creation of trusts. As a result, a successful claim can significantly alter the distribution of an estate from that originally intended by the deceased.
Why do disputes arise?
Every family is different. Disputes often arise where:
- a family member has been excluded from a Will;
- children have been treated unequally;
- a long-term partner has not been provided for;
- someone does not receive something they have been promised or think they’re entitled to;
- there are concerns regarding financial dependency; or
- family circumstances have changed since the Will was prepared.
Whilst disputes cannot always be avoided, careful estate planning can help reduce the likelihood of disagreements after death.
Do letters of wishes help?
Whilst Letters of Wishes are not legally binding, they can be highly persuasive evidence of a person’s intentions and the rationale behind their estate planning decisions and therefore may be used to assist executors, trustees and family members in understanding the deceased’s intentions.
A Letter of Wishes may explain why certain beneficiaries have received different amounts, why assets have been left in trust or why particular individuals have been excluded from benefiting.
This can be particularly important where a Will creates discretionary trusts, unequal gifts between family members or provisions which may be perceived as unusual by disappointed beneficiaries or the court without further knowledge into the family dynamics of the deceased.
Planning ahead
A well-drafted Will remains the most effective way of ensuring that your wishes are known. However, estate planning should not stop there.
Regularly reviewing your Will, considering the use of trusts and preparing an accompanying Letter of Wishes can help provide clarity for those left behind and reduce the risk of future disputes.
How we can help
DWF’s Tax & Private Capital team advises individuals, families, executors and trustees on Wills, estate planning, Deeds of Variation and contentious probate matters.
If you would like to discuss your estate planning arrangements or review an existing Will, please contact a member of our team.
