Estate planning prompts us to consider the future and provide for our loved ones after we're gone.
While wills and trusts are standard tools for this, there is a legal concept that arises in some circumstances – the deathbed gift, also known as "donatio mortis causa." This allows individuals to make gifts whilst on their deathbed or before imminent death.
In this article, we will explore:
The concept of deathbed gifts
The legality around them
The potential implications for estate planning
So, whether you're planning your estate or simply curious about the legal aspects of gift-giving, let's find out more.
What is a deathbed gift?
A deathbed gift, also known as "donatio mortis causa" in legal terms, is a unique type of gift or transfer of property that occurs when while on your deathbed or in anticipation of your imminent death, you give an item or asset to someone, often with the intention that it will belong to them once you die.
You must give your gift in contemplation of your impending death, which would typically be due to illness, old age, or other reasons that might make death reasonably foreseeable.
The gift is conditional, meaning it only takes effect when you die. If you were to recover or decided to revoke the gift before passing away, it becomes null and void and would remain in your possession.
Unlike wills and trusts, deathbed gifts do not require the same formalities and they can be made verbally or through simple actions without the need for legal documents.
Is a deathbed gift legal?
Yes, a deathbed gift is legal as long as the following specific criteria is met:
The gift must be made by you in contemplation of your impending death.
It only takes effect if you pass away as anticipated.
There must be a physical or symbolic delivery of the gift.
You must have the mental capacity to make the gift.
You must intend to give the gift to the recipient. This intent should be unambiguous.
If these conditions are met, a deathbed gift can be considered legally valid. However, like anything, disputes can arise, especially when there is uncertainty or disagreement. In such cases, a court may need to determine whether the gifting met the criteria above.
If you are thinking about giving a deathbed gift, consult a legal professional as soon as possible for peace of mind that your gifting will be legal and valid.
How to claim a deathbed gifts
To claim a deathbed gift, first ensure that the deathbed gift meets the legal criteria as discussed earlier. To support this, collect any evidence you have that supports the gift's validity, such as any witness testimonies, the donor's intent expressions, and any other relevant documents or correspondence.
It's worth seeking legal advice from an estate planning solicitor who specialises in these matters. They can help you assess if the gift is valid, provide guidance on the legal requirements, and assist you in navigating the process.
Before you can claim the deathbed gift, the donor must pass away. If the donor recovers or passes away under different circumstances, the gift becomes void. Once the donor has passed away, you need to notify the executor or personal representative of the donor's estate, if applicable. They will play a role in helping to transfer the gift to you.
Be prepared for the possibility of disputes or challenges to the gift. If someone else claims a superior right to the gift or contests its validity, this may require legal resolution.
The problem with deathbed gifts
Deathbed gifts can be a really memorable and meaningful act, however there are some problems associated with them.
The validity of the deathbed gift might be argued, which could lead to arguments and uncertainties. There might be questions around the donor's mental capacity, the timing of the gift, or the donor's true intent. This is why documentation and evidence of the gifting can really help to avoid these situations.
If the donor does not pass away shortly after making the gift, the person receiving the gift may need to return the gifted property or assets. This can be quite distressing and disappointing for the person who was expecting to receive the gift and could sour relationships.
Yes, unfortunately deathbed gifts may also have inheritance tax implications. In some cases, the value of the gift could be subject to tax if it exceeds certain thresholds. Managing these tax implications can be financially complex.
When we talk about wills and gifting, there is always a threat of influence or coercion. Vulnerable individuals, especially those nearing the end of their lives, may be susceptible to undue influence which of course raises concerns about exploitation and how authentic the gift may really be.
Unlike formal wills and trusts, deathbed gifts do not have to have legal oversight. This can lead to difficulty in validating the gift's authenticity and not having any evidence to prove under what circumstances it happened. If you can, we always suggest to try and document or evidence the deathbed gift in an appropriate way.
Get deathbed gift support with Lawhive.
If you need any help and advice relating to estate planning, making a will, or making gifts, get in touch with our legal assessment team today. They will assess your case and provide clear next steps, along with a fixed fee quote to get you sorted.