Deeds of Variation
Originally sent: December 22, 2004I recently reported to the case of John Lamberton, who was prosecuted for Inheritance Tax evasion. As I reminded you in that e-mail, evasion is something none of us can afford to get involved in, but there are many legal ways of reducing or avoiding tax bills altogether.
One very common method of doing so for Inheritance Tax bills is by use of a Deed of Variation.
As I am sure you are aware, you can only use a Deed of Variation if it is signed by all the beneficiaries who would be affected. All well and good if all said beneficiaries are alive. But what if one of them has died before the Deed is drawn up and signed?
This might be a rather unusual situation, but it is not unheard of. So, what can be done in those circumstances?
You will be pleased to hear that Inland Revenue have confirmed that you can still proceed with the Deed of Variation. All that is necessary is to have the personal representatives of the deceased beneficiary enter into the agreement. This position was originally stated by Inland Revenue in Tax Bulletin 19, and they have repeated their stance on this in the latest Bulletin.
Of course, Deeds of Variation are by no means the only way of reducing Inheritance Tax bills. And what about all the other tax bills? Corporation Tax, Income Tax, Capital Gains Tax, and Stamp Duty Land Tax ? the list goes on! If you want to know more about these taxes, and ways to reduce their effect, you should start attending our Focus Coaching days. And if you want to stay ahead of the pack and ensure your business becomes more and more profitable why not join one of our very successful coaching programmes?
Adviser Breakthrough Training Solutions Ltd. takes no responsibility for loss occasioned by any person acting or refraining from action, or in consequence of any other person acting or refraining from action, as a result of the material in this article.
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