This option is for lawyers who prefer a simpler clause where a trust provides for unlimited capital and income encroachment, This option is available where:
- There is a trust cash gift
- Includes an age duration
- There are either no Mandatory Payments or only staged lump sum payments
- Discretionary Payments are set to Unlimited.
In this case with the Simple Unlimited Encroachment option checked off, rather than having two separate clauses one dealing with income and the other dealing with capital, they are combined into a shorter single clause. For example:
"My Trustee may pay or apply the whole or such part of the net income arising from my Child's Fund and the whole or such part of the capital of my Child's Fund as my Trustee in their absolute discretion considers advisable to or for the benefit of my child. If in any year my Child's Fund, or any part thereof, is held by my Trustee, and any portion of the said net income is not paid to or applied for the benefit of my child, such portion shall be accumulated by my Trustee and added to the capital of my Child's Fund and be dealt with as part thereof; provided that after the expiration of the maximum period permitted by law for the accumulation of income hereunder, if my Child's Fund or any part thereof is being held, my Trustee shall thereafter pay to or apply for the benefit of my child the whole of the net income derived therefrom."
The Option is found under "Gift Options" for each Will.
You can set this as an default option at the firm level or for any particular client.
Note: Even if Simple Unlimited Encroachment is checked off, it will only run this combined clause when the other requirements are met.
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