Absolute (bare) trust – one where the named beneficiaries are entitled both to trust income and capital and where their entitlement cannot be changed.

Accumulation and maintenance trust – a discretionary trust where the property is held for the maintenance, education or benefit of the children or grandchildren, or accumulated until the beneficiaries reach age 25 at the latest. At that time, they become entitled to trust capital or income. Prior to 22 March 2006 these trusts were treated favourably for IHT purposes.

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