A deed by which one or more beneficiaries of a deceased person’s estate give up their entitlements under the deceased's will or the intestacy rules in favour of other persons.

Sometimes referred to as a deed of family arrangement.

A beneficiary who gives up their entitlement makes a lifetime disposition, which may be a gift (a voluntary disposition) or may be for consideration. However, if the disposition is made within two years after the deceased's death and meets other statutory conditions (including that there is no consideration from outside the estate), it is treated as if it had been made by the deceased for inheritance tax and some capital gains tax purposes (section 142, Inheritance Tax Act 1984 and section 62(6)-(10), Taxation of Chargeable Gains Act 1992), but for no other purpose.

For more information, see Practice notes:

For a precedent deed, see Standard document, Variation: disposition under a will, the law of survivorship or by nomination, deed with drafting notes.

In 2015, the government reviewed the use of deeds of variation for tax purposes. It decided not to change the tax treatment but will continue to monitor their use (see Private client tax legislation tracker 2015-16: Deeds of variation review).