I’m looking at the tax impact of unwinding a very old Trust from the 1940s but the ‘remainder’ beneficiaries want to know what rights they have on the Primary Beneficiaries death.
I’ve put the redacted wording below but it is clear that there was an A&M style settlement followed by an IIP for the Primary Beneficiary (a QIIP as the right to income started prior to 2006). The final beneficiaries do not get the assets absolutely (UPON TRUST) but neither does it give them a right to the income (the only right to income is mentioned in the clause regarding the primary beneficiary). However, neither are the Trustees given any power of discretion over the Trust Fund apart from in relation to the Primary Beneficiary under the age of 21.
Given this is a very old Trust - would the use of UPON TRUST without any other provisions simply mean a bare trust structure? Or could it be the other extreme whereby it is a Trust over the capital with income accumulated?
- UPON TRUST during the minority of the said [Primary Beneficiary] in the absolute discretion of the Trustees to apply the whole or any part of the income of the Trust Fund in or towards the maintenance education preferment or benefit of the said [Primary Beneficiary]
- After the said [Primary Beneficiary] has attained the age of twenty one years UPON TRUST to hold the income thereof upon protective trusts for the benefit of said [Primary Beneficiary] during her life
- After the death of the said [Primary Beneficiary] UPON TRUST in equal shares if more than one for all or any the children or child of the said [Primary Beneficiary] who survive her and attain the age of twenty one years or marry under that age and for all or any of the issue who survive the said [Primary Beneficiary] and attain the age of twenty one years or marry under that age of any child of the said [Primary Beneficiary] who predeceases her said issue to take through all degrees according to their stocks in equal shares if more than one the whole or the share of the Trust Fund which his her or their parent would have taken had he or she survived the said [Primary Beneficiary] and so that no issue shall take whose parent survives the said [Primary Beneficiary] and is capable of taking