TSEM1840 - Introduction to trusts: supplementary deeds: deed of disclaimer
A person uses a true disclaimer to refuse a gift due under a trust. Effectively the person steps aside. This allows subsequent provisions of the trust to take effect.
A disclaimer can relate to
- capital
- income
- both.
A disclaimer has retrospective effect. It applies from the date that the entitlement arose. There may be a lapse of time between the entitlement arising and the disclaimer. This is not conclusive evidence that the deed cannot be a true disclaimer.
The person disclaiming
The person disclaiming is not a ‘settlor’ within Section 620(1) ITTOIA (TSEM4120). Subsequent trusts that result from the disclaimer retain their original settlor.
The person making a disclaimer may still benefit from another part of the trust income or capital. This is irrelevant. If that person seeks to impose new trusts, the deed is not a disclaimer. It is an assignment (TSEM1845).