I am dealing with a discretionary will trust where a deed of appointment was signed some time ago to create a revocable right to income in favour of 2 beneficiaries.
The intention now is to wind up the trust by way of absolute appointments (to different beneficiaries). However, under usual “life interest rules” this would amount to a PET by each of the life tenants should they pass away within 7 years.
Would it make any difference if the rights to income were revoked before the appointments out? Does the revocation of a right to income have the same IHT effect as a surrender of an interest in possession? Would a subsequent appointment from the trust change the result?
Any comments appreciated…