873Discretionary or accumulation settlementsU.K.
(1)A settlement is a discretionary or accumulation settlement for the purposes of this Chapter if any income arising to the trustees would (unless treated as income of the settlor) be to any extent income within subsection (2) for the tax year in which it arises.
(2)Income is within this subsection so far as it is—
(a)accumulated or discretionary income as defined in section 480 (other than income arising under a trust established for charitable purposes only or an unauthorised unit trust in relation to which section 504 applies), or
(b)an amount of a type set out in section 482 (unless the trust is a unit trust scheme or the amount is income arising under a trust established for charitable purposes only or is excluded by section 481(5)).
(3)A person is a beneficiary under a discretionary or accumulation settlement for the purposes of this Chapter if—
(a)the person is an actual or potential beneficiary under the settlement, and
(b)condition A or B is met in relation to the person.
(4)Condition A is that the person is, or will or may become, entitled under the settlement to receive some or all of any income under the settlement.
(5)Condition B is that some or all of any income under the settlement may be paid to or used for the benefit of the person in the exercise of a discretion conferred under the settlement.
(6)The references in subsections (4) and (5) to any income under the settlement include a reference to any capital under the settlement so far as it represents amounts originally received by the trustees as income.