Estate Duty surviving spouse exemption: powers where the person is competent to dispose
A person is competent to dispose (IHTM04457) of property if they are free to appoint it to whom they wish, or if they have an unfettered power to revoke the trusts and declare new ones and can exercise that power for their own benefit.
If a person with a general power of appointment must exercise it in a stipulated manner, they are still regarded as competent to dispose of the property, provided that they can appoint to anyone of their choice (Re Priestley’s Will Trusts  3 AER 1025).
Whether the power can be exercised by will or by deed (IHTM04460) or both will have a bearing on the competency to dispose.
If property to which the surviving spouse became absolutely entitled by survivorship was settled by that spouse on the trusts of the will of the other spouse in which he or she took a life interest, the surviving spouse should be treated as competent to dispose between the date of the death and the date of the election. (Att Gen v National Provincial Bank Ltd  12 ATC 133)