SCHEDULES
SCHEDULE 1F1Application of Exempt Amount in Particular Cases
Trustees
C15
1
For any year of assessment during the whole or part of which settled property is held on trusts which secure that, during the lifetime of a mentally disabled person or a person in receipt of attendance allowance,
F2a
not less than half of the property which is applied is applied for the benefit of that person, and
b
that person is entitled to not less than half of the income arising from the property, or no such income may be applied for the benefit of any other person
F3subsections (1), (4) and (5) shall apply to the trustees of the settlement as they apply to an individual.
F41A
The trusts on which settled property is held shall not be treated as falling outside sub-paragraph (1) above by reason only of the powers conferred on the trustees by section 32 of the Trustee Act 1925 or section 33 of the Trustee Act (Northern Ireland) 1958 (powers of advancement); and the reference in that sub-paragraph to the life-time of a person shall, where the income from the settled property is held for his benefit on trusts of the kind described in section 33 of the Trustee Act 1925 (protective trusts), be construed as a reference to the period during which the income is held on trust for him.
1B
In relation to a settlement which is one of two or more qualifying settlements comprised in a group, this paragraph shall have effect as if for the references in section 5 of this Act to F5the exempt amount for the year there were substituted references to F5one tenth of that exempt amount or, if it is more, to such amount as results from dividing F5the exempt amount for the year by the number of settlements in the group.
1C
For the purposes of sub-paragraph (1B) above—
a
a qualifying settlement is any settlement (other than an excluded settlement) which is made on or after 10th March 1981 and to the trustees of which this paragraph applies for the year of assessment; and
b
all qualifying settlements in relation to which the same person is the settlor constitute a group.
1D
If, in consequence of two or more persons being settlors in relation to it, a settlement is comprised in two or more groups comprising different numbers of settlements, sub-paragraph (1B) above shall apply to it as if the number by which F6the exempt amount for the year is to be divided were the number of settlements in the largest group.
2
In this paragraph “mentally disabled person” means a person who by reason of mental disorder within the meaning of the F7Mental Health Act 1983 is incapable of administering his property or managing his affairs and “attendance allowance” means an allowance under section 35 of the M1Social Security Act 1975 or the M2Social Security (Northern Ireland) Act 1975 F8; and “settlor” and “excluded settlement” have the same meanings as in paragraph 6 below.
F93
An inspector may by notice in writing require any person, being a party to a settlement, to furnish him within such time as he may direct (not being less than twenty-eight days) with such particulars as he thinks necessary for the purposes of this paragraph.
Heading substituted by Finance Act 1982 (c. 39, SIF 63:2), s. 80(3) for 1982–83 et seq.