Commentary on Sections Overview Overview Section 873: Discretionary or accumulation settlements
2639.This section makes provision about when a settlement is to be regarded as a discretionary or accumulation settlement, and when a person is to be regarded as a beneficiary of such a settlement, for the purposes of the Chapter. It is based on sections 481(4A) and 482(5A) of ICTA and regulation 2 of the building society regulations.
2640.Subsection (2) ensures that the section applies in the same way that section 481(4A) of ICTA did before 6 April 2006. See Change 85 in Annex 1.
2641.In regulation 2(1) of the building society regulations, part of the definition of discretionary and accumulation trust (which, following the enactment of paragraph 37 of Schedule 13 to FA 2006, is now a reference to “settlement”) refers to “income of the settlor applied in defraying expenses of the trustees”. These words have not been included as they are obsolete.