Conditional Gifts in Wills: Legacies with Specific Requirements
When you make your Will, you might be tempted to make certain gifts conditional on the beneficiary doing or not doing something. We examine ‘What is a conditional gift?’ and look at leaving conditional gifts in wills.
It is open to you to leave your assets to whomever you wish when writing a UK Will, including a charity or organisation. There are no exceptions to this. Although in some circumstances a close family member or someone dependent on you may apply to the court for reasonable financial provision from your estate. This is if they are excluded from your Will.
What is a conditional gift?
A conditional gift in a Will is when an asset it left to someone only if they meet a certain condition. This could be doing something or not doing something. A common conditional gift used in Will writing is to leave assets to individuals to be inherited when they reach a certain age. For example 21 or 25.
Another example is to leave an asset to someone if they attend university or if they get divorced.
A conditional gift can also be property or other assets in which someone is left a life interest. The ultimate beneficiary only receives them on that persons death. For example, a spouse could receive a life interest in a shared home when their partner dies. When the spouse dies, the children inherit. Their inheritance can therefore be considered to be conditional on the death of the person with the life interest.
Is it legal to leave a conditional gift in a Will?
While it is generally legal to leave a conditional gift in a Will, it is important to make sure the gift will be valid. In some circumstances, a conditional gift could be found void by the courts. This could be if the will is ambiguous or poorly drafted. Also if it is not possible to clearly establish whether the condition has been met. For example, a condition that someone inherits if they stop seeing a certain individual would be difficult to prove beyond doubt.
Reasons to avoid leaving a conditional gift
In some circumstances, it might not be wise to leave conditional gifts. Consider who will manage and invest the gift until it can be passed to the beneficiary. A trustee needs to be appointed to deal with this. It could be time-consuming and onerous and you need to ensure they are prepared to take on the role. Likewise, your executor needs to be happy to check in the future to see whether the condition has been satisfied.
Additionally, you must consider what happens to the money if the condition is not met. For example, if the gift was conditional upon someone going to university, you might want to enforce a time limit. Otherwise the funds would need to be held indefinitely, waiting for the condition to be met.
Imposing conditions that may not be met, means your loved ones might not inherit anything from you.
Where the conditions you have imposed are not straightforward, there could be disagreement over whether or not they have been met. For this reason, conditional gift giving should be approached with caution. Always seek expert legal advice when drafting a Will.
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