Section 480 | Meaning of “accumulated or discretionary income”

(1)Income is accumulated or discretionary income so far as—

(a)it must be accumulated, or

(b)it is payable at the discretion of the trustees or any other person,

and it is not excluded by subsection (3).

(2)The cases covered by subsection (1)(b) include cases where the trustees have, or any other person has, any discretion over one or more of the following matters—

(a)whether, or the extent to which, the income is to be accumulated,

(b)the persons to whom the income is to be paid, and

(c)how much of the income is to be paid to any person.

(3)Income is excluded for the purposes of subsection (1) so far as—

(a)before being distributed, it is the income of any person other than the trustees,

(b)it is income from property within subsection (4), or

(c)it is income from service charges which are paid in respect of dwellings in the United Kingdom and are held on trust.

(4)Property is within this subsection if it—

(a)is held for the purposes of a superannuation fund to which section 615(3) of ICTA (superannuation funds relating to undertakings outside the UK) applies, but

(b)is not held as a member of a property investment LLP.

(5)In subsection (3)(c) “service charges” has the meaning given by section 18 of the Landlord and Tenant Act 1985 (but as if that section also applied in relation to dwellings in Scotland and Northern Ireland).