Variations
You'll learn what a variation (or deed of variation) is and how to use it as a powerful tax planning tool after someone dies.
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In this lesson
- 0:00 What is a variation and why it matters
- 0:41 Tax planning benefits of variations
- 1:52 How variations work for inheritance tax
- 2:57 Worked example: Direct gift versus deed of variation
- 4:19 Deed of variation tax treatment explained
About this lesson
This lesson covers the strict legal requirements—it must be in writing, signed by the original beneficiary, made for no consideration, and completed within two years of death—and shows you how variations can eliminate inheritance tax charges, utilise the residence nil rate band, and avoid double taxation on gifts. Through worked examples, you'll see how variations are treated differently for inheritance tax and capital gains tax purposes, and crucially, how to spot variation opportunities in exam questions to reduce your client's overall tax liability.
Duration: 5m
Transcript
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