(1)This section applies to settled property transferred into settlement after 9th March 1981 and held on trusts—
(a)under which, during the life of a disabled person, no interest in possession in the settled property subsists, and
(b)which secure that not less than half of the settled property which is applied during his life is applied for his benefit.
(2)For the purposes of this Act the person mentioned in subsection (1) above shall be treated as beneficially entitled to an interest in possession in the settled property.
(3)The trusts on which settled property is held shall not be treated as falling outside subsection (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 M1Trustee Act (Northern Ireland) 1958 (powers of advancement).
(4)The reference in subsection (1) above to a disabled person is, in relation to any settled property, a reference to a person who, when the property was transferred into settlement, was—
(a)incapable, by reason of mental disorder within the meaning of the M2Mental Health Act 1983, of administering his property or managing his affairs, or
(b)in receipt of an attendance allowance under [F164 of the Social Security Contributions and Benefits Act 1992 or][F2section 64 of the Social Security Contributions and Benefits (Northern Ireland) Act 1992]. [F3, or
in receipt of a disability living allowance under section [F171 of the Social Security Contributions and Benefits Act 1992][F4or [F2section 71 of the Social Security Contributions and Benefits (Northern Ireland) Act 1992]]by virtue of entitlement to the care component at the highest or middle rate.]
[F5(5)The reference in subsection (1) above to a disabled person includes, in relation to any settled property, a reference to a person who, when the property was transferred into settlement,—
(a)would have been in receipt of attendance allowance under section 64 of either of the Acts mentioned in subsection (4)(b) above had provision made by regulations under section 67(1) or (2) of that Act (non-satisfaction of conditions for attendance allowance where person is undergoing treatment for renal failure in a hospital or is provided with certain accommodation) been ignored, or
(b)would have been in receipt of disability living allowance by virtue of entitlement to the care component at the highest or middle rate had provision made by regulations under section 72(8) of either of the Acts mentioned in subsection (4)(c) above (no payment of disability living allowance for persons for whom certain accommodation is provided) been ignored.
(6)The reference in subsection (1) above to a disabled person also includes, in relation to any settled property, a reference to a person who satisfies the Commissioners for Her Majesty's Revenue and Customs—
(a)that he would, when the property was transferred into settlement, have been in receipt of attendance allowance under section 64 of either of the Acts mentioned in subsection (4)(b) above—
(i)had he met the conditions as to residence under section 64(1) of that Act, and
(ii)had provision made by regulations under section 67(1) or (2) of that Act been ignored, or
(b)that he would, when the property was transferred into settlement, have been in receipt of a disability living allowance by virtue of entitlement to the care component at the highest or middle rate—
(i)had he met the prescribed conditions as to residence under section 71(6) of either of the Acts mentioned in subsection (4)(c) above, and
(ii)had provision made by regulations under section 72(8) of that Act been ignored.]
Textual Amendments
F1Words in s. 89(4)(b)(c) substituted (1.7.1992) by Social Security (Consequential Provisions) Act 1992 (c. 6), ss. 4, 7(2), Sch. 2 para. 66(1)(2).
F2Words in s. 89(4)(b)(c) substituted (1.7.1992) by virtue of Social Security (Consequential Provisions) (Northern Ireland) Act 1992 (c. 9), ss. 4, 7(2), Sch. 2 para. 29(1)(2).
F3S. 89(4)(c) and 'or' preceding it inserted (3.2.1992 for certain purposes and 6.4.1992) by Disability Living Allowance and Disability Working Allowance Act 1991 (c. 21, SIF 113:1), s. 4(2), Sch. 2 para. 14(2); S.I. 1991/2617, art. 2(c)(f).
F4Words in s. 89(4)(c) inserted (6.4.1992) by S.I. 1991/2874, art. 4(3); S.R. 1992/94, art 2.
F5S. 89(5)-(6) inserted (22.3.2006 for certain purposes) by Finance Act 2006 (c. 25), s. 156, Sch. 20 para. 6(2)(4)
Marginal Citations