Personal Injury Trusts
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If you have or are about to receive compensation following a personal injury claim, you may want to consider protecting your compensation by placing it into personal injury trusts.
An award of compensation can affect your eligibility for means-tested state benefits and can also lead to other passport benefits being stopped; it could also affect your partner if they too receive means-tested benefits. Even if you do not receive means-tested benefits now, a personal injury trust can be of great value to you and your family if in the future you should require long term care.
WE PROVIDED MARK WITH ADVICE AND RECOMMENDED THAT HE SET UP A PERSONAL INJURY TRUST. A TRUST DEED WAS PREPARED WHICH DETAILED MARK, HIS WIFE AND DAUGHTER AS TRUSTEES.
Mark’s Story
Mark is a gentleman aged 58 whose personal injury claim settled for £85,000.
At the time of settlement, Mark was receiving Employment Support Allowance, which is a means -tested benefit. The level of compensation meant that Mark would be obliged to declare this income to the Benefits Agency and as such would be at risk of losing his entitlement to this benefit.
How we helped
Mark was provided with advice and was recommended to set up a personal injury trust. A Trust Deed was prepared which detailed Mark, his wife and daughter as Trustees.
The compensation payment was paid straight into the Trust Account meaning Mark would be able to retain his entitlement to means-tested benefits.
All names have been changed to protect the identities of the individuals
Benefits of a Trust
The benefit of holding the compensation within the trust is that it will be protected and cannot be taken into account in any financial assessments when calculating entitlement to either means-tested benefits or care.
The trust is created when you sign a trust deed and you will need to appoint trustees. The trustees can be anyone over the age of 18 whom you trust to help look after your compensation and who are reliable and good with money. You can also choose to be a trustee yourself or consider the appointment of a professional trustee.
Using your Funds
Once the compensation is within the trust you will be able, with the assistance of your trustees, to utilise those personal injury trust funds in a way which is appropriate for your own particular circumstances e.g. a place to live, a holiday or the purchase of a new car.
Capacity
If the person who is entitled to receive the personal injury award does not have mental capacity to manage their own affairs then they cannot sign the necessary Trust Deed. Instead they will require a Deputy appointed by the Court of Protection to manage their affairs.
