The guidance at IFM3120 advises that income arising during a distribution period is not distributed to investors as cash, but is retained in the fund as an additional captital investment on behalf of the investor. The amounts reinvested are taxed as income accruing to investors in the same way as if it had been distributed.
This means that you are taxed each year on the amount reinvested in the same way as if it had been paid in cash. This prevents investors delaying payment of Income Tax, through long term accumulation of income.
IFM03120 - Investors in authorised investment funds (AIFs): accumulation units