IN the unfortunate event of a loved one passing, you may be named as a beneficiary in their will, meaning that you have been selected to inherit some of their assets. This may include money, property, motor vehicles or other belongings. Being named as a beneficiary is a significant honour because it represents the final act of the deceased to express their affection for those whom they loved. Nevertheless, you may choose to disclaim your inheritance in full or in part.

Reasons for disclaiming

1) To eliminate or reduce tax obligations.

2) Beneficiaries seeking funding from the National Housing Trust (NHT) to purchase a house or land may receive a low-value property as a gift in one parish while living in another, even if they do not plan to reside at the gifted property. The beneficiary has the option to relinquish their interest in the property, allowing them to maximise their NHT benefits. NHT policy states that individuals listed on a registered certificate of title are disqualified from accessing funds to purchase a home or land.

3) When an estate is distributed among family beneficiaries, each person receives only a share of the total inheritance. A beneficiary who is satisfied with their financial situation may not see the need for additional money or assets, particularly if other beneficiaries are in greater need of the inheritance because of their financial circumstances. For example, another beneficiary may be in considerable debt from student loans or medical expenses or supporting a larger family that needs extra assistance. You may also believe that another beneficiary deserves a greater share of the inheritance because of their care of the benefactor during the latter’s lifetime or illness. In such cases, you may opt to disclaim your inheritance to allow the other beneficiary to receive an additional share.

) The gift has deteriorated or requires substantial effort to regain its value. For example, it may be an unregistered parcel of land or a small property in a remote area of the island that has fallen into disrepair and has incurred expenses such as property taxes or is subject to registration fees under the Registration of Titles Act. Other examples include an inoperable motor vehicle that needs repairs before it can be registered or a business that demands significant time and commitment to run before it can be sold.

5) Inherited property could be located in another country such as the United States or United Kingdom, where mortgage, maintenance or inheritance taxes apply, or it could be encumbered by debt, creating a financial burden for the beneficiary.

6) Accepting an inheritance may lead to family disputes or conflict. If the recipient had become estranged from the testator, it could create issues with other relatives.

How does one disclaim

A gift cannot be disclaimed until the testator has died. If the testator is still alive, they may choose to amend their will as long as they have the capacity to do so.

A disclaimer of inheritance must be executed promptly and communicated in writing to the executor or administrator of an estate to ensure its effectiveness.

A deed of disclaimer for evidentiary purposes must be unambiguous. Ideally, it should be drafted by an attorney, who will take the necessary steps to ensure it is legally binding.

What happens with the share of an inheritance that has been disclaimed?

When an inheritance is disclaimed, it is treated in the same way as if the original beneficiary had died. The will may specify how the inheritance is to be redistributed in this case and who else is eligible to receive it.

If the person has died intestate (ie without leaving a will), then the Intestates’ Estates and Property Charges Act must be considered to determine who is entitled to receive the disclaimed gift under the applicable intestacy laws.

In the case of more than two beneficiaries, when one wishes for a specific person to inherit their share but does not wish to disclaim it for some reason, the share can only be given to the chosen beneficiary through a deed of gift once the estate has been settled. While this may incur additional charges, it is the only legal means of gifting an inheritance that has not been disclaimed. Otherwise, it will be divided and distributed among the other beneficiaries according to the provisions of the will or intestacy laws.

Venice Williams is a partner

and attorney-at-law for

Lewis, Smith, Williams & Co.

Email her at: vwilliams@lswlegal.com

Venice Williams