Deed of variation: how to change a will after a death (UK)

26 October 2026 · Inherit Vault

A will isn't always the last word. In the UK, the people who inherit can rewrite who gets what after the death. If they do it the right way, the tax rules treat the change as if the person who died made it. It's called a deed of variation, and it has a hard two year deadline.

What a deed of variation actually is

It's a written document signed by someone who's inherited something. In it, they redirect some or all of their share to someone else. Say your mum leaves you £100,000, and you'd rather half of it went to your kids. You can sign a deed that sends £50,000 straight to them. The law is section 142 of the Inheritance Tax Act 1984. It works for a will, for the intestacy rules, and for some other ways property passes on a death.

Why anyone would bother

The big reason is tax. Normally, if you give away money you've inherited, that's your own gift. It sits in your estate for seven years under the seven year rule on gifts. Do it through a valid deed instead, and for inheritance tax it's read back as if your mum left the money to your kids herself. Your own estate never touches it. Section 62 of the Taxation of Chargeable Gains Act 1992 does the same for capital gains tax. So the person who receives the asset takes it at its value on the date of death.

It also fixes wills that have aged badly. A will written 20 years ago might leave nothing to a grandchild born since. It might name a charity that has closed. Families use a deed to put things right without a court case.

It works when there's no will too

If someone dies without a will, the intestacy rules decide who inherits. Those rules are strict. They leave out unmarried partners and stepchildren. A deed of variation lets the people who do inherit pass some of it on. It's often the only tidy way to do what everyone knows the person wanted.

The two year deadline is real

The deed must be signed within two years of the death. HMRC's own manual says everyone who's a party must have signed inside that window, and there's no discretion. Miss it by a day and the tax read-back is gone. You can still give the money away, but it's a plain gift from you, with all the tax that comes with it.

The rules the deed has to follow

It must be in writing. It must be signed by the people giving up their share. It must say which gifts it changes, and where they go now. You can't be paid for doing it, not in money and not in kind. The only trade allowed is another variation of the same estate.

There's one line people forget. The deed must include a statement that section 142 applies, or section 62, or both. Without it, the tax treatment doesn't kick in at all, even if everything else is spot on. That's been the rule for deeds signed since 1 August 2002.

When HMRC needs to see it

Most deeds never go to HMRC. You only have to send it if the change means more inheritance tax is due. Then it must reach HMRC within six months of signing, with a sum showing the extra tax. In that case the executors must sign the statement too. They can only refuse if they don't hold enough of the estate to pay the extra.

HMRC's form IOV2 is a checklist for drafting one. It's handy even when nothing goes to HMRC, as it walks you through each condition.

The charity trick

Here's a neat one. If at least 10% of the net estate goes to charity, the inheritance tax rate on some assets drops from 40% to 36%. A deed can add a charity gift after the death to get over that line. Sometimes the tax saved covers most of the gift. It's worth running the numbers with a calculator before deciding. Gifts to charity are among the inheritance tax exemptions that can bring a bill right down.

Property and stamp duty

If a house moves through a deed, there's usually no stamp duty. The Finance Act 2003 exempts it, as long as it's done within two years and nobody pays for it. If cash changes hands in return, that exemption goes.

What a deed can't do

It can't help someone who's already been paid for their share. It doesn't change income tax in the same way. If a parent redirects money to their own young children, income on it can still be taxed as the parent's, so get advice first. And it can't undo a gift the person made while alive. It only changes what passed on the death.

The gotchas

Means-tested benefits are one. If you're on Universal Credit and you give away an inheritance, the DWP can treat you as still having it. Another is the residence nil rate band. Redirect a home away from children or grandchildren and the estate can lose up to £175,000 of tax free allowance. One more: anyone under 18 can't sign a deed. If a child would lose out, you'd need the court to agree.

Getting it done

Most solicitors charge a fixed fee to draft a deed of variation. Check the will, list who inherits what, agree the change, and get everyone to sign well inside the two years. Don't leave it to the last month. Someone will be on holiday.

A deed of variation is a second chance at a will. It only works if the family knows what's in the estate early enough to use it. Two years goes fast while you're still hunting for accounts nobody wrote down. A clear record of what's there, kept now, gives the people you leave behind the time to get it right.

Sorting this out for someone else? Make sure your family never has to.

Most of the time goes on finding out what the person had and who to call. Inherit Vault keeps that list for you: your accounts, pensions and policies, and where your will is kept. Only you can read it. Your executor gets it when it is needed.

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