Deed of Variation

A Deed of Variation, also known as an Instrument of Variation or a Deed of Family Arrangement, is a legal document that enables the beneficiaries of a deceased person's estate to alter the distribution of assets set out in the deceased person's Will, or under the intestacy rules if there is no Will.

A Deed of Variation is often used to reduce the amount of inheritance tax that may be payable by the beneficiaries. This is achieved by redirecting some or all of the deceased person's assets to a trust, which can have more favourable tax treatment than an outright gift to a beneficiary.

The beneficiaries of the estate must agree to the changes made in the Deed of Variation, and it must be signed within two years of the date of death of the testator. The funds can be redirected to a Discretionary Trust, a Life Interest Trust, or an Interest in Possession Trust.