Effective 1 June, we have a new address: 34 Imperial Square, Cheltenham, Gloucestershire GL50 1QZ
Get in Touch Menu

Budget proposal threatens use of deeds of variation to avoid inheritance tax

19 March 2015

After George Osborne delivered his Budget yesterday, our expert wills, probate and trusts lawyer Simon Cook considers the impact of one of the proposals.

“I can also tell the House that we will conduct a review on the avoidance of inheritance tax through the use of deeds of variation. It will report by the autumn,” said George Osborne in his Budget statement yesterday.

At the moment deeds of variation can be used to vary entitlements under a will. If executed within two years of the date of death the inheritance tax and capital gains tax consequences can be written back to the person who has died, rather than the person making the variation. This can have advantageous tax results and has been used on numerous occasions – including by Ed and David Miliband following the death of their father in 1994.

If deeds of variation are abolished then it removes the ability of the family to rearrange affairs in a tax efficient manner after the death has occurred. It therefore emphasises the need to take professional advice about putting your affairs in order and having a correctly drafted will in place. There will be no more second bites at the cherry.

The moral is – make sure you have a will and it is drafted correctly.

Simon Cook is a partner in our wills, probate & trusts department. He handles all aspects of private client work such as trusts (including personal injury trusts), wills, powers of attorney, Court of Protection and estate planning and administration.

We're here to help
Simon Cook LLB (Hons), TEP
View profile
Simon Cook
Related services
Share this article
Resources to help

Related articles

One month to go: countdown to 1 September Trust Registration Service deadline

Wills, trusts & probate

There is just one month to go until 1 September, when all ‘express trusts’ must be registered with the Trust Registration Service (TRS). One of our trusts experts, Tom O’Riordan…

Tom O'Riordan LLB (Hons)
Senior associate, solicitor

Key change to capital gains reporting

Wills, trusts & probate

There is one radical change that may have slipped under the radar of most grappling with the pandemic: changes to how capital gains on the sale or disposal of UK…

Laura Stone LLB (Hons)
Senior associate, solicitor

Deeds of variation: When is it appropriate to use them?

Wills, trusts & probate

If you are due to inherit and you would like to redirect your inheritance elsewhere (for example if you would prefer your children to inherit instead), you can do this…

Jennifer Cockett LLB (Hons)
Associate, solicitor
Contact us