Can I make a conditional gift in my will?

Gifting in wills

Gifting in wills, sometimes called legacy gifting, can be a lovely way to bond with your loved ones after you pass. Leaving emotional gifts with sentimental value, or financial gifts that could change your loved one's life are incredibly meaningful to both the person giving the gift and the recipient.

You may wish to encourage your loved ones to make choices you would support when making your gift or choose to protect family dynamics by requesting the will is not contested, conditions on your gift can help with this.

What is a conditional gift?

Within a will, a conditional gift is where you leave something to a loved one but attach a condition or requirement that must be met before they can receive it. If the condition is not fulfilled, the gift might go to someone else or be withheld entirely.

Conditional gifts allow the person writing the will to encourage or discourage certain behaviours, protect their assets from being misused, and ensure their wishes are respected.

Common examples of conditional gifts in wills

The most common uses of conditional gifts in wills include:

• Age: the person receiving the gift must reach a certain age such as 18, 25 or 30.
• Education: completing a degree, apprenticeship, or qualification considered important by the person leaving the gift.
• Marriage: the recipient must be married or married for a certain length of time before receiving their gift.
• Behaviour: staying out of legal trouble or avoiding substance abuse.
• Actions: the gift would be dependent on what the recipient did or did not do, such as not contesting the will, or caring for a pet.

The advantages of leaving conditional gifts

There can be many advantages to adding conditions to the gifts in your will, one of the most important being that you can still have control over when and how your assets can be used. Conditional gifts can encourage positive behaviour such as completing education or remaining employed, which can help ensure the inheritance is not misused.

As well as this control element, a condition on a gift can be crucial when protecting your gift from becoming split within a divorce. If one of your beneficiaries is coming to the end of their relationship, placing a condition on it that they only receive it after the divorce will protect it from becoming a martial asset and therefore open to being taken.

Placing conditions on a gift can also help prevent legal disputes after you have passed. A condition of no contest can ensure your family and loved ones know not to question your final decisions and to respect your wishes.

An additional benefit is that, if used strategically and planned properly, a condition on a gift can mean indirect tax benefits. If a gift is conditional on age or achievement, it may be held in a trust until the condition is met. This can delay the transfer of ownership and potentially reduce the value of the estate at the time of death, thereby minimising how much inheritance tax owed on your estate.

It is important to note that conditional gifts do not automatically reduce inheritance tax unless tied to specific strategies like charitable giving or trust planning, as mentioned above.

The disadvantages of leaving conditional gifts

While conditional gifts can feel like the perfect way to leave your assets to loved ones as you can ensure your wishes are respected and help with tax, there are several disadvantages to consider – the first of which is the legal complexity of conditional gifts.

Any conditions must be very clearly worded and legally enforceable. Poorly worded conditions can led to disputes or unintended tax consequences, so it important to consult experts in wills and probate to ensure your conditions are valid and enforceable

Placing conditions on inheritance can also delay the distribution of your estate and create the possibility of gifts never being received due to unmet conditions. Therefore, when making conditions on inheritance, it is important to consider that circumstances may change, such as illness, disability, or financial hardship, and what should happen if a condition becomes impossible to achieve.

Adding conditions also increases an executor's workload as they will need to monitor and verify if and when the conditions of gifts are met. It adds complexity to this administrative role and demands ongoing responsibility and oversight, so you will need to make sure that the executors you name in your will are aware of the conditions and understand what it means for them.

Why might a conditional gift be deemed void?

There are several reasons why a conditional gift in a will may not be legally valid and therefore deemed void. These include situations where a condition:

• Violates public policy: for instance, if the condition is discriminative
• Is illegal: such as encouraging a person to commit an offence like theft
• Is deemed immortal: an example could be requiring someone to divorce a spouse
• Is too vague or not clearly defined: this could be caused by ambiguous wording, such as ‘live a respectable life’ or ‘be a good person’
• Is not achievable: any condition attached to a gift must be considered possible for the person to whom the gift is given

Further to this, if the will itself is not clear and properly executed, such as not being signed or witnessed correctly, all gifts including conditional ones may be void. This is why it is so important to have the support of an expert wills and trusts lawyer to ensure your wishes are upheld and will be legally binding.

Legal support for conditional gifting in wills with our specialist wills solicitors

Conditional gifts can be an incredible tool to encourage your family and loved ones to uphold you desires and guide them when you are no longer around. They are also an amazing way to ensure you assets are not used in a way you would not approve of.

Ensuring your conditional gifts are binding is vital, so they must be worded clearly and carefully, and all paperwork should be appropriately signed, witnessed and filed.

Our team of leading experts in wills and trusts offer compassionate legal support and have extensive experience in conditional gifts. To get personalised support call us today on 0330 041 5869 or contact us online.