I have a new client who placed her home into trust in 2016. The trust creates a life interest for her, there is a discretionary power of appointment over capital during the life interest (although she is not a potential beneficiary of the discretionary power) and then on her death the trust says
‘The capital and income of the Trust Fund shall be held on such trusts…as the Settlor shall by will or codicil appoint.’
I appreciate that generally, RNRB will be restricted where a property is in this kind of trust, but if the final distribution is based on the terms of her Will (which leaves her estate to her sons), does this change the position?
Also, if RNRB is not available, might the downsizing allowance apply providing she still has other assets in her estate of the value of the house passing down to direct descendants?
Many thanks