Guidance in TSEM: elections and claims
The special tax treatment for trusts with vulnerable beneficiaries only applies for a tax year if the trustees have made a claim. The normal 5 year plus 10 months time limit for claims applies, see TMA1970/S43(1). However, they can only make a claim for a tax year where two conditions are met. Firstly, that in the tax year they hold property on qualifying trusts for the benefit of a vulnerable person. Secondly, a joint election has been made by the trustees and the vulnerable person under FA2005/S37. See TSEM3450.
The vulnerable person is not a party to the claim but is to the election. The special treatment applies both to income tax and CGT. It is not possible to claim special treatment for one tax and not the other, although there may be cases where only one tax is affected even though there are chargeable gains and income (see TSEM3461).