Commentary

I5.551 Qualifying conditions of 18–25 trusts—overview

IHT, trusts and estates

I5.551 Qualifying conditions of 18–25 trusts—overview

18–25 trusts

I5.551 Qualifying conditions of 18–25 trusts—overview

Settled property will be subject to the 18–25 trust regime in two separate situations. The key difference to note between these separate situations is that the first one requires that the trust be established under the Will of a deceased parent of the under 25 year old, the Criminal Injuries Compensation Scheme (CICS) or the Victims of Overseas Terrorism Compensation Scheme (VOTCS). This requirement is not necessary for the second situation (old accumulation and maintenance (A&M) trusts).

The 18–25 trust regime was only introduced on 22 March 2006, but applies not only to property settled on or after 22 March 2006, but also to property settled before 22 March 20061. In the case of the similar provision in relation to bereaved minor trusts this might mean that trusts in possession on 22 March 2006 will have become subject to the bereaved minors regime on 22 March 2006. However, in view of the fact that the A&M trust rules continue to apply in priority to the 18–25 rules (and not vice versa), it is not thought that any trusts in possession can have automatically become 18–25 trusts on 22 March 2006, because if they would satisfy these rules on 22 March 2006 they would almost certainly have satisfied the A&M trust rules.

Trusts arising under Will, CICS or VOTCS

Settled property will fall within the 18–25 trust regime if2:

  1.  

    (a)     it is held on trust for the benefit of a person who has

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