Commentary

I5.1303 Beneficiary with vested interest

IHT, trusts and estates

I5.1303 Beneficiary with vested interest

I5.1303 Beneficiary with vested interest

Where a beneficiary is absolutely entitled (see I5.1017) to income arising under a settlement, it forms part of his taxable income for the year in which it arises whether or not it is paid to him or accumulated.

There will be a vested interest if the trustees, under a discretion, mandate to a beneficiary the income from specified assets held by the settlement1. 'Vested' means that the interest either already is or will eventually come into the hands of the beneficiary2. The future event must be certain to happen, even if it is impossible to say

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