Family Provisions and IPFDA

Question 1

What are the three requirements to be eligible under IPFDA?

Answer 1

The applicant must:

(i) Be domiciled in the UK;

(ii) Be in a recognised category of applicant; and

(iii) Apply within 6 months after the grant of representation

AND

The deceased must die domiciled in England and Wales

Question 2

What are the six categories of applicants under IPFDA?

Answer 2

(1) spouse or civil partner;

(2) former spouse or civil partner who hasn’t re-married;

(3) child of the deceased;

(4) treated as a child by the deceased;

(5) anyone who was, immediately before death, maintained by the deceased (for money or money’s worth);

(6) anyone who, for 2 years before death, lived in the same household as the deceased as husband or wife.

Question 3

What is the provision for non-spousal applicants under IPFDA?

Answer 3

Whether the deceased left enough money for the maintenance of the applicant.

Question 4

What is the spousal provision under IPFDA?

Answer 4

Whether there was a reasonable financial provision for the spouse, regardless of maintenance.

Question 5

What is the ex-spouse provision?

Answer 5

Whatever the ex could have reasonably gotten in a divorce.

Question 6

What special considerations are considered when making financial provisions for a child of the deceased?

Answer 6

• a moral obligation;
• the adult having a disability;
• adult child working for the deceased for a low wage;
• the child making sacrifices for the deceased;
• how the child may have been educated/trained

EFFECTIVELY: Did the child make sacrifices for the parent that may have necessitated a higher level of maintenance?

Question 7

How can the co-habitants category be satisfied?

Answer 7

Cohabitants, who haven’t formalised their relationship by marriage or civil partnership, must show:

(i) they lived in the same household as the deceased;

(ii) as the husband, wife or civil partner; and

(iii) this must have been for the whole of the two years immediately preceding the deceased’s death.

Question 8

When must an application be made under IPFDA?

Answer 8

Applications must be made within 6 months from the date of the grant of representation.

Question 9

What guidelines are considered when determining whether the provision standard has been met?

Answer 9

(i) financial resources and needs of the applicant and other possible applicants;
(ii) the deceased’s obligation towards any applicant or beneficiary;
(iii) the size and nature of the estate;
(iv) physical or mental disability of any applicant or beneficiary;
(v) other factors, e.g. the conduct of the applicant.

Question 10

How is a post-death variation made?

Answer 10

The original beneficiary must:

(i) be 18 or over;
(ii) have mental capacity;
(iii) make the variation within 2 years of the deceased’s death and have the variation signed in writing.

Question 11

What is the effect of a variation?

Answer 11

Treated as if the deceased gave the gift to the new beneficiary in the will.

Question 12

How does a beneficiary avoid adverse IHT consequences from a variation?

Answer 12

Write the variation back to the will for tax purposes so it is as if the variation was made by the testator.