Glossary · UK
What is Accumulation and Maintenance Trust?
A historic type of UK trust set up for children or young beneficiaries, where income could be accumulated until they reached a set age.
Full Definition
An accumulation and maintenance (A&M) trust was a UK trust commonly used to provide for children or grandchildren, allowing trustees to accumulate income rather than pay it out, and to use funds for a beneficiary's maintenance, education or benefit. Beneficiaries typically became entitled to capital or income by a specified age, often 18 or 25. A&M trusts once enjoyed favourable inheritance tax treatment, but the Finance Act 2006 largely removed this special status; most A&M trusts created or continuing after 2008 fall within the standard relevant property regime, facing periodic (ten-year) and exit charges. Genuinely new A&M trusts can no longer be set up with the old reliefs, so the term mainly describes existing arrangements or bereaved minors' and 18-to-25 trusts that replaced them. They matter for estate planning families, as the tax position depends heavily on when the trust was made and the beneficiaries' ages.