Codicils and rewriting wills

You should review your will at least every five years to take
account of any changes that may affect it. There may be changes that have occurred among your beneficiaries, for example, or to the laws of wills and probate, or you may have changed your mind about certain things since you first made the will.

You can make alterations to your will by writing a codicil. This is a document that details any changes you wish to make to your will.

It should be kept in the same envelope as your original will.
You can use a codicil to increase or reduce legacies, create
additional ones, maybe to charities, and change executors if
circumstances have changed and the original executor is no
longer able, or no longer wants, to act.

To be effective, the codicil must be signed by you in the presence of two witnesses in the same way as when you originally signed your will. The witnesses do not need to be the same ones who signed your will. You can make as many changes as you like, but if you are making many amendments it may be better to draft a new will.

Changing a will after death: deeds of variation

If you do not update your will in the few years leading up to your death, there may have been changes in taxation or in your family situation that you would have taken account of had you reviewed and updated the will. This is very common, particularly when people are very unwell or mentally incapacitated.

In certain circumstances a deed of variation can be drafted if
your executors can see that the will could have been rewritten
to reduce the amount of Inheritance Tax payable from the estate, or that a tax benefit could be achieved by transferring some assets to your grandchildren. The changes made by the deed will be regarded by the Capital Taxes Office of HM Revenue as if the changes had been in your will. The executors of your will would, however, have to get consent from anyone affected by the changes, and, in the case of minor beneficiaries, a court order.

Jargon Buster

Administering the estate means dealing with the affairs of the person who has died.

Assets are valuable things that you own. Your home is likely to be your most valuable asset.

Beneficiaries are the people to whom you leave possessions in your will.

Capital Gains Tax – a tax paid on anything you sell or give away over £6000. Some of your assets are exempt from this tax.

Chattels are tangible, movable property such as furniture, works of art, crockery, jewellery, motor vehicles and items of plant and machinery that are not permanently fixed.

A deed of variation is a way for a will to be rewritten if all the beneficiaries agree. It can be a useful way to reduce Inheritance Tax.

Estate – this is everything that you own at the time of your death, less what you owe.

Executors are people named in a will who will administer the estate.

HM Revenue & Customs is the government department that deals with tax, including Inheritance Tax.

Intestate – dying without leaving a will is known as dying intestate.

Inheritance Tax is the tax paid on your estate after you die. Everyone is allowed to leave a certain amount before Inheritance Tax is payable; for 2009-10, this amount is £325,000. Inheritance Tax is sometimes shortened to IHT.

Lasting powers of attorney are a way to give someone else the power to handle your finances if you become incapable of looking after your own affairs. Lasting powers of attorney (LPAs) replace enduring powers of attorney (EPAs). No new EPAs can be set up, but old ones are still valid.

Legacies are gifts of money or property left to someone in a will. They can be left to either individuals or organisations.

Potentially Exempt Transfer (PETs) – a gift that is only free from Inheritance Tax if you live for seven years after making the gift. If you die within seven years, a system called taper relief works out the amount of tax that is payable on the gift.

Probate refers to administering the estate of the person who has died, according to his or her will. In Scotland, this is known as confirmation.

Residue The residue of an estate is everything that is left when bequests and legacies have been distributed and any debts and other liabilities settled.

Trustees are the people responsible for looking after any part of your estate that is put into a trust.

Trusts are a way to leave some or all of your estate to a person or group of people. A trustee will manage it for you.