The beneficiary of an estate has executed a Deed of Variation redirecting £50,000 of his entitlement to his daughter. He has now asked to do another DoV to redirect a further sum to another person. Is this allowable? There is no IHT impact as there was no IHT to pay.
Provided that the second variation is not seeking to redirect the benefit that was redirected by the first variation, HMRC will normally accept that s.142 IHTA 1984 (and s.62(6) TCGA 1992) will apply to the second variation.
Paul Saunders FCIB TEP
Independent Trust Consultant
Providing support and advice to fellow professionals
Yes, that is fine.
The thing (or one of the things) to watch out for is that, once a thing has been redirected once under s142 IHTA 1984, the same thing cannot be redirected again under s142. That means that a beneficiary can redirect different parts of their inheritance at different times within the two year period.