Getting technical: An education in controlled access trusts

Before the Finance Act 2006, a popular trust used for education funding was the Accumulation and Maintenance (A&M) trust. Many A&M trusts were used for school fees planning, allowing a grandparent, for example, to put aside a lump sum for grandchildren. The trustees could accumulate the income and use this for paying the school fees for the beneficiary. At a certain date – usually the beneficiary's 25th birthday – they became absolutely entitled to the trust property. The original gift was treated as a potentially exempt transfer and the structure provided an element of control over h...