What are the perpetuity and accumulation rules at present?
The perpetuity rules provide that beneficiaries’ interests in a trust must vest (ie become certain) within a set time (known as the perpetuity period) in order to ensure that property cannot be held in a trust indefinitely. At present the perpetuity period is either: • A set period of 80 years from the date the trust was made; or • The lifetime of selected persons living when the trust is made, plus 21 years (the common law period). Similarly the accumulation rules provide that trustees only have power to accumulate income within a trust (rather than distribute it to beneficiaries) for a limited period. At present, the law permits a number of alternative accumulation periods including the period of 21 years from the date the trust is established. 2. Which trusts will be affected by the new rules? The new rules apply to lifetime trusts made on or after 6 April 2010. In contrast, will trusts only have the benefit of the new rules if the will is executed on or after 6 April 2010. Therefor
