H set up a lifetime pilot trust years ago and has now passed away, the Will leaves the estate to the pilot trust with the beneficiaries of the discretionary trust being the spouse and child. All beneficiaries of full age and capacity. It would be more beneficial now in the circumstances to have a LIT for the surviving spouse and then onto a vulnerable persons trust. Is it possible to use a deed of variation to vary the Will/to change the existing trust? Or any suggestions as to the best options in this scenario? Also, if it would be possible to change the position, would the reading back effect apply?
Thank you in advance for any thoughts.
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My understanding is that notwithstanding that the estate passes into a long-existing discretionary trust, as the trust fund was settled only on the death of the testator, an appointment made by the trustees within 2 years of the testator’s death would still come within s.144 IHTA 1984.
On that basis, the trustees could appoint onto an IIP and secure spouse relief within the estate.
Paul Saunders FCIB TEP
Independent Trust Consultant
Providing support and advice to fellow professionals
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IHTA 1984 s144 should apply so as to enable the trustees of the pilot trust, created pre-death, to effect appointments out of the estate property settled within the normal two year period. "Reading back will then occur.
I agree with Paul.
Malcolm finney
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Thank you for your replies.