Disabled Trusts

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 Disabled 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 Disabled 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 a Disabled 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 Disabled Trust 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

Ahmed Said - Tingatinga artist

Wrigleys discovers a talented artist amongst its team in Ahmed Said, an accomplished specialist in Tingatinga style painting

Click here to view more

Holiday pay changes affecting schools

Two recent changes relating to the treatment of holiday pay are important for schools and academies to note.

Click here to view more

Wrigleys Solicitors welcome new lawyers

Wrigleys celebrates another successful year for its trainee recruitment process, and welcomes Trusts and Estates specialist solicitor Kieran McIvor.

Click here to view more

Receive the latest news, events and updates from Wrigleys:

Follow Wrigleys: