Special Needs Trust

What is a Special Needs Trust?

A Special Needs Trust is a trust that contains money received as a consequence of personal injury.
They are trusts created for disabled individuals, which are intended to supplement, but not replace, any means-tested benefits to which the disabled individual may be entitled.

These 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
  • Council Tax 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

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 Special Needs 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 Special Needs Trust as it still may prove cost effective.

Click 'email your query' to fill in our enquiry form so we can contact you.
There are other considerations. If you think you may need to go into residential care at some point in the future, then establishing a Special Needs Trust will protect your compensation from being taken away by the Local Authority in order to pay for your care fees.

 

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