472Settlor where property becomes settled because of variation of will etc
(1)This section applies if—
(a)a disposition of property following a person’s death is varied, and
(b)section 62(6) of TCGA 1992 applies in relation to the variation.
(2)If property becomes settled property because of the variation (and would not, but for the variation, have become settled property), a person within subsection (3) is treated for the purposes of the Income Tax Acts (except where the context otherwise requires)—
(a)as having made the settlement, and
(b)as having provided the property for the purposes of the settlement.
(3)The persons within this subsection are—
(a)a person who immediately before the variation was entitled to the property, or to property from which it derived, absolutely as legatee,
(b)a person who immediately before the variation would have been so entitled if that person had not been an infant or otherwise lacking legal capacity,
(c)a person who, but for the variation, would have become so entitled, and
(d)a person who, but for the variation, would have become so entitled if that person had not been an infant or otherwise lacking legal capacity.
(4)For the purposes of subsection (3)—
(a)“legatee” includes a person taking property—
(i)under a testamentary disposition or on an intestacy or partial intestacy, whether beneficially or as trustee, or
(ii)under a donatio mortis causa, and
(b)a person who is a legatee as a result of paragraph (a)(ii) is treated as acquiring the property when the donor dies.
(5)For the purposes of subsection (4)(a) property taken under a testamentary disposition or on an intestacy or partial intestacy includes any property appropriated by the personal representatives in or towards satisfaction of—
(a)a pecuniary legacy, or
(b)any other interest or share in the property devolving under the disposition or intestacy.