Disabled Trust

What is a Disabled Trust?

A Disabled Trust can mean two different things:

  1. another name for a Personal Injury Trust that contains money received as a consequence of personal injury or
  2. a trust founded to protect the interests of a disabled person generally.

A personal injury related Disabilities Trust is a trust created for disabled individuals, which is intended to supplement, but not replace, any means-tested benefits to which the disabled individual may be entitled.

Personal injury related Disabilities Trusts are established for working-age adults or some children who want to retain their entitlement to means tested benefits, now or in the future, such as:

  • Income Support
  • Housing Benefit
  • Working Families Tax Credit
  • Disabled Person’s Tax Credit
  • Income Based Jobseeker’s Allowance
  • Employment & Support Allowance
  • Some care at home/in residential care
  • Council Tax Support (for those of Pension age) 

Under the current rules – if you have over £6,000 capital you are at risk of having some or all of your benefits reduced. If you have over £16,000 then you are at risk of losing them all entirely. If your compensation is paid directly to you, rather than put into a trust, then you will be classed as having this money as your disposable capital.

If you are expecting to receive more than £6,000 in compensation for your personal injury, then you should consider setting up this type of Trust. Even if you are expecting to receive less than £10,000 in compensation for your personal injury, you should still seek advise on whether to establish a Trust of this kind as it still may prove cost effective.

In other circumstances, a traditional Disabled Trust is usually founded by a third party for the benefit of another e.g. a child with a disability. It has certain tax and other advantages apart from fulfilling a protective function.

 

Click 'email your query' to fill in our enquiry form so we can contact you.

Request a No Obligation Pack

Mailing List

Perpetual affordability - a key aim for community-led housing

We are often asked is how to make housing affordable in perpetuity. There is no easy answer, though this article explores a possible solution.

Click here to view more

Obscure law that community housing groups need to know

Did you know that landlords (incl community housing landlords) are obliged to consult with tenants under 'long term tenancy agreements'?

Click here to view more

The June Yorkshire Family Business Bulletin

This month, Thomas Wainman considers 'employee ownership' as an option for family businesses plus the usual mix of news, insights and perspectives.

Click here to view more

Receive the latest news, events and updates from Wrigleys:

Follow Wrigleys: