The following Private Client guidance note provides comprehensive and up to date legal information covering:
The rules relating to perpetuities and accumulations stem from the provisions in the Perpetuities and Accumulations Act 1964 (PAA 1964) and from common law. These increasingly archaic rules were becoming troublesome and as long ago as 1989 the Law Commission started consultations on altering them. This culminated in a paper in 1993 identifying defects in the system and a final Report in 1998 with a draft bill. This resulted in the Perpetuities and Accumulations Act 2009 (PAA 2009) which gives effect to that Report.
PAA 2009 became operable on 6 April 2010 but practitioners will still have to have regard to the old rules in certain cases.
As indicated, the old rules are contained in common law and in PAA 1964 and provide that a future interest must vest (to prevent it being perpetually inalienable):
at common law, within a life or lives in being at the date of the disposition plus 21 years
under PAA 1964, within a period of up to 80 years as specified or 21 years in the case of an option in respect of land
In respect of accumulations of income, the permitted periods are:
the lifetime of the grantor/settlor
the minority of person(s) living or en ventre sa mère at the death of the grantor/settlor/testator
the minority of person(s) who, if of
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