A will creates a life interest in the deceased’s share of the property for her spouse. The remainder beneficiary is the deceased’s child (or the child’s issue if she fails to obtain a vested interest). The trustees have the power to pay the deceased’s share of the property to the life tenant, the child or the child’s issue (none currently). The life tenant wants to terminate his IIP in favour of the child. I understand this will be regarded as a PET by him. What I am not clear on is what power the trustees need to exercise to end the IIP. I think they have both a power of appointment and also the statutory power of advancement but would welcome members’ views.
If the trustees have an overriding power of appointment then I would use that - avoids having to consider the conditionality of using the statutory powers.
You might also find that if the LT waived his/her interest the result would be that the trustees were holding as bare trustees for the LTs child, if there is no other eligible beneficiary at the point of the waiver. But that would depend on the wording of the interest in remainder. There might simply be a continuing trust for the remaindermen as a group.
Have you thought about CGT? Exit from trust is a disposal, not an uplift on death situation.