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Where trustees have not paid income to the income beneficiaries, but have accumulated it instead, what steps can be taken to rectify the situation?

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Published on LexisPSL on 21/12/2017

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  • Where trustees have not paid income to the income beneficiaries, but have accumulated it instead, what steps can be taken to rectify the situation?

Where trustees have not paid income to the income beneficiaries, but have accumulated it instead, what steps can be taken to rectify the situation?

For the purposes of this Q&A, we have assumed that the settlement in question was originally established as an accumulation and maintenance settlement under the legislative rules that existed prior to 22 March 2006, see Practice Note: Accumulation and maintenance trusts—IHT. We have also assumed that the beneficiaries all have an interest in possession in the trust income.

Strictly speaking, the trustees are in breach of trust for not having complied with the terms of the settlement (see Practice Note: Trustees—duties). However, it

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