ihta84/s86.- Trust for benefit of employees.

[1975 Sch.5,
para.17(1);
1982 s.98(2).]

86.-(1) Where settled property is held on trusts which, either indefinitely or until the end of a period (whether defined by a date or in some other way) do no permit any of the settled property to be applied otherwise than for the benefit of-

(a) persons of a class defined by reference to employment in a particular trade or profession, or employment by, or office with, a body carrying on a trade, profession or undertaking, or

(b) person of a class defined by reference to marriage or relationship to, or dependence on, persons of a class defined as mentioned in paragraph (a) above,

them, subject to subsection (3) below, this section applies to that settled property or, as the case may be, applies to it during that period.

[1975 Sch.5,
para.17(1A);
1982 s.98(4).]

(2) Where settled property is held on trusts permitting the property to be applied for the benefit of persons within paragraph (a) or (b) of subsection (1) above, those trusts shall not be regarded as outside the description specified in that subsection by reason only that they also permit the settled property to be applied for charitable purposes.

[1975 Sch.5
para.17(2);
1982 s.98(5).]

1988 c.1

(3) Where any class mentioned in subsection (1) above is defined by reference to employment by or office with a particular body, this section applied to the settled property only if-

(a) the class comprises all or most of the persons employed by or holding office with the body concerned, or

(b) the trusts on which the settled property is held are those of a profit sharing scheme approved in accordance with Schedule 9 to the [Taxes Act 1988 ¹ ].

[1975 Sch.5
para.17(3);
1984 Sch.21
para.12.]

(4) Where this section applies to any settled property-

(a) the property shall be treated as comprised in one settlement, whether or not it would fall to be so treated apart from this section, and

(b) an interest in possession in any part of the settled property shall be disregarded for the purposes of this Act (except section 55) if that part is less than 5 per cent. of the whole.

[1975 Sch.5,
para.17(4A);
1976 s.107(2).]

(5) Where any property to which this section applies ceases to be comprised in a settlement and, either immediately or not more than one month later, the whole of it becomes comprised in another settlement, then, if this section again applies to it when it becomes comprised in the second settlement, it shall be treated for all the purposes of this Act as if it had remained comprised in the first settlement.

1 Substituted by 1988(T),Sch.29,para.32. Originally "Finance Act 1978".