According to the terms of the Will Trust (death was in 2003) the "Accumulation Period" is to last 21 years (ends some time during 2024) and the Closing Day is the day before the 80th anniversary of the death (ends some time in 2083) . So the Accumulation Period will end in two years' time.
According to the Will Trust clause, from the termination of the Accumulation Period to the Closing Day (a 59-year period), trust income is to be paid to the beneficiaries "in such manner as my Trustees shall from time to time in their absolute discretion think fit".
It would appear that the Will Trust binds the Trustees to pay out ALL income of the year during the post-"Accumulation Period" of 59 years.
Just looking at TSEM3780 attached, third bullet point regarding the end of accumulation periods, where it says "so the trustees cannot accumulate income and have to pay out all income to beneficiaries".
So, my question is, are the Trustees permitted to pay out LESS than the annual income of the Trust, or are they obliged to pay out the whole lot.
What if it is anticipated that in the following year major repair works will have to be undertaken on trust property giving rise to a reluctance to pay out any income. of that earlier year (or indeed years if it is major repair work).
By coincidence, the Accumulation Period will end at roughly the same time as the youngest grandchild beneficiary starts work, so their personal tax allowance is no longer free to absorb discretionary income distributions. It seems that the Trustees are wanting to accumulate income again rather than distribute. Is this illegal from the point of view of the Will Trust provisions/general law and/or tax law.
By the way, for these old trusts (when HMRC used to peruse trust deeds in the "good old days") I suspect HMRC may be aware of the duration of "Accumulation Periods". It would not be too much of an effort for the HMRC computer to select trusts which have income during Accumulation Periods and which fail to distribute. Could HMRC create any tax issues even without broaching any trust deed/general law matters.
Any useful comments would be appreciated.