As far as I am aware, currently it is not affected by the Finance Act. I have good authority on this...read this:
Discounted gift trusts
The Inland Revenue confirmed that in cases where the settlor disposes of a life policy (or other intangible property) to a trust under which part of the trust fund is held absolutely and indefeasibly for himself and the balance of the trust fund on a settlement for others (and from which the settlor but not his spouse is excluded from benefit) then the new charge does not arise by virtue of paragraphs 8(1)(a) and (b).
They will regard the settlorÂ´s entitlement as a bare trust and not settled property.
This means that the part of the fund representing the settlorÂ´s entitlement to a stream of capital payments contingent on the settlor being alive on certain future dates will not count as part of the trust property. So provided the settlor is excluded from the other (gifted) part of the fund, which in most cases will be the case, then the pre-owned assets rules will not bite.
Consequently discounted gift schemes and retained interest trusts (where the settlor has a right to a lump of capital rather than a stream of capital payments) will not be subject to the pre-owned assets provisions. The Revenue reserve the right to change the rules if "abusive" schemes are marketed that manipulate this relief.
Hopefully this will not change when the act is finalised.
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