Modifications etc. (not altering text)
C1 See also—1970(M) s.31(3)—appeals on application of ss.660to 685to go to Special Commissioners.1974 s.43—development gains accruing to trustees to be charged at basic plus additional rates.1988 s.339(6), (7)—treatment for corporation tax of covenanted donation to charity.1988 s.762—offshore income gains.1989 s.110—residence of trustees.
(1)M1If and so long as the terms of any settlement (wherever made) are such that—
(a)any person has or may have power, whether immediately or in the future, and whether with or without the consent of any other person, to revoke or otherwise determine the settlement or any provision thereof; and
(b)in the event of the exercise of the power, the settlor or the wife or husband of the settlor will or may become beneficially entitled to the whole or any part of the property then comprised in the settlement or of the income arising from the whole or any part of the property so comprised,
any income arising under the settlement from the property comprised in the settlement in any year of assessment or from a corresponding part of that property, or a corresponding part of any such income, as the case may be, shall, subject to subsection (2) below, be treated for all the purposes of the Income Tax Acts as the income of the settlor for that year and not as the income of any other person.
(2)Where any such power cannot be exercised within six years from the time when any particular property first becomes comprised in the settlement, subsection (1) above shall not apply to income arising under the settlement from that property, or from property representing that property, so long as the power cannot be exercised.
(3)M2In subsection (1) above the references to a power to revoke or otherwise determine a settlement or any provision thereof shall be deemed to include references to—
(a)any power to diminish the property comprised in the settlement; and
(b)any power to diminish the amount of any payments which are or may be payable under the settlement or any provision thereof to any person other than the settlor and the wife or husband of the settlor.