Query re deed of variation and power of appointment

I am dealing with the winding up of a life interest trust set up in the will of a testator who died in the 1970s. It left his widow a life interest in the family farm, subject to which it passes to such of their children and remoter issue as the widow shall by deed or will appoint.

She has died and her will appoints the farmland in certain proportions amongst the children.

One of the children is the farmer and lives in the farmhouse situate on the trust land. As such, his siblings want to give him the “homestead” area, with the rest of the land split in the original proportions ie they are making a gift of their share of the homestead.

I am concerned as to whether such an arrangement can be written back for IHT purposes. The IHTA provides that property in which the deceased has an interest in possession is not included for the purposes of a variation under section 142, however I understand that if the deceased had a power of appointment which was exercised by will, the recipient/s of the gift can then vary.

I am unsure from what I have read whether this only applies to the exercise of a general power and not specific but wonder if anyone is able to comment or point me in the direction of further authority?

Helen Newson
Andrew & Co LLP