Commentary on Sections Accumulations Section 14: Restrictions on accumulation for charitable trusts
69.Section 14 makes specific provision in relation to charitable trusts. The section provides that any power or duty to accumulate is subject to a maximum period of 21 years, unless the trust instrument specifies that the power or duty to accumulate ceases to have effect on the death of the settlor or, where there are multiple settlors, the death of a settlor identified by name or order of death (subsection (5)). The 21 year period starts from the first day when the power or duty must or may be exercised (subsection (4)).
70.If a trust instrument provides for an accumulation period longer than 21 years, then (except where subsection (5) applies) the power or duty to accumulate ceases to have effect after 21 years (subsection (3)). Subsection (6) provides that the income is then distributed or applied as it would have been had there been no duty or power to accumulate in the terms of the trust. This follows the model of the pre-Act legislation on accumulations: see the Law of Property Act 1925, section 164(1).
71.Subsection (2) provides that the 21-year restriction on accumulation does not apply where the provision in the instrument has been made by a court or the Charity Commission for England and Wales.