Commentary on Sections Structure of Chapters Overview Section 472: Trusts created by two or more persons
1892.This section determines each settlor’s share of the rights, or of a share in the rights, in policies or contracts where, immediately before the chargeable event in question, the rights (or that share) are held on non-charitable trusts created by two or more persons. It also sets out how that share is determined if the property held on trust was added by different settlors, whether at the time the trust was created or at a later date. It is based on section 547A of ICTA.
1893.Subsections (3) to (7) determine the appropriate share if settlors contribute different property to the trust or a new settlor adds property to a trust already created. The trust is treated as if it had been created by all of them, including the new settlor where applicable, and each is treated as the only settlor for the purposes of this section. The rules set out explicitly when someone is regarded as having contributed property to the trust. For example, subsection (7) applies when A contributes property to what is essentially B’s settlement because B has made an equivalent contribution to A’s settlement. Although B’s contribution is treated as property provided by A for the purposes of subsection (6), A’s contribution under reciprocal arrangements with B is disregarded.
1894.Subsection (4)(c) allocates a bundle of types of property between settlors on the basis of a “just and reasonable” apportionment where this is necessary for the purposes of subsections (2) and (3). See Change 14 in Annex 1.