TSEM1567 - Introduction to trusts: types of trust: accumulation and maintenance trust

An 鈥榓ccumulation and maintenance鈥� trust has some CGT privileges. (It used also to have IHT advantages until FA 2006 removed them.)

The basic conditions are that there is settled property (TSEM1102) where

  • there is no interest in possession
  • the income must be accumulated unless it is applied for the maintenance, education or benefit of a beneficiary within the next bullet
  • one or more beneficiaries must on or before reaching 25 become
  • entitled to the property or
  • entitled to an interest in possession

In other words, by that age they must have an interest in possession (TSEM1564).

If the question is raised whether a trust qualifies as an accumulation and maintenance trust for CGT purposes, internal users only should refer to Capital Gains Technical.