Q&As

Can a pre-2010 discretionary trust be varied to alter the accumulation period, where the primary beneficiary is 21 and has learning disabilities?

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Published on LexisPSL on 26/03/2021

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  • Can a pre-2010 discretionary trust be varied to alter the accumulation period, where the primary beneficiary is 21 and has learning disabilities?

Can a pre-2010 discretionary trust be varied to alter the accumulation period, where the primary beneficiary is 21 and has learning disabilities?

An overview of the law on perpetuities and accumulations can be found in Practice Note: Perpetuities and accumulations.

It appears that the trust in question was created before the Perpetuities and Accumulations Act 2009 (PAA 2009) came into force and has an accumulation period limited to 21 years. As explained in the above Practice Note, PAA 2009 abolished the rule against excessive accumulations in relation to trusts created on or after 6 April 2010 with the effect that trustees can, in principle, accumulate income for the entire lifetime of the trust.

Any power to accumulate income (either under section 31 of the Trustee Act 1925 or under any other express power in the trust deed) will not apply after the expiry of the 21-year accumulation period and the trustees will not be able to accumulate income after the end of this period. Instead it will need to be distributed to one of the beneficiaries within a reasonable period of time (Re Gulbenkian’s Settlement Trusts No

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