What is the difference between income and accumulation units?

An income unit will distribute any interest or dividend income from the fund to you. An accumulation unit is designed to offer you growth in the fund rather than income, so any income generated will be reinvested within the fund, raising the value of your investment.

Note that both income and accumulation dividends are included on your annual tax certificate as the income 'paid' within an accumulation fund is still taxable. Your book cost is increased however when a dividend is paid on an accumulation unit to ensure a corresponding reduction of liability to capital gains tax.