Separate settlements: appointments while estate in administration
A will may set up a discretionary trust and specify that the power of appointment is tobe exercised within two years of death. This is because IHTA84/S144 treats the exercise asif it had been provided for in the will. There are no special Capital Gains Tax rules forthis situation. This exercise is not a deed of variation, but a normal exercise of a powerof appointment. See CG31432+ for the CGT treatment if the power is exercised beforeresidue has been ascertained or assent given. Otherwise the normal Capital Gains Tax rulesapply.
The IHT treatment is explained in IHTM35181+.