A trust has different features with respect to the allocation and payment of the income and capital of a trust based on the age of certain beneficiaries. Do these features have an impact on whether s. 104(18) is satisfied?
CRA indicated that the discretion to determine the amount of non-payable income that goes to the children, or to distribute the capital if the capital includes the children's vested income account, would prevent compliance with s. 104(18. Conversely, the trust becoming discretionary once all the beneficiaries have attained 21 or the trustee having discretion as to the timing of the payment of the children's vested income account, would not preclude compliance. CRA further noted that the entitlement of a recipient who has not attained 21 years of age to his or her share of unpaid income must be vested and the entitlement to that amount must not be subject to any future conditions other than the condition that the recipient live to an age not exceeding 40 years.