Question:
If two siblings inherit their parent's estate, valued at £650,000, and one sibling wants to transfer their share to the other through a deed of variation (DOV), how will this impact the inheritance tax (IHT) liability?
Arthur Weller replies
If the new beneficiary under a DOV is an exempt beneficiary, this can reduce the estate IHT liability. But in the case you describe of two siblings, most likely it will not make any difference to the estate IHT liability.
