Personal injury trusts
If you are in receipt of means tested benefits or care home fee funding (or may become a candidate for such funding in the future) and win compensation resulting from a personal injury or accident then a personal injury trust is an opportunity for you to use your compensation without the payment affecting entitlement to your welfare benefits. Such trusts are vital in many cases and if the compensation is not paid into a personal injury trust then claimants may lose their benefits.
If you are not presently in receipt of benefits or care home fee funding but consider that you may need to make a claim in the future then it is worthwhile protecting your personal injury compensation in a personal injury trust. This is because if you save the compensation you may later find that you have to use the funds to pay for your own care. Furthermore, if you try to rapidly deplete the compensation by spending it quickly you could fall foul of strict Local Authority rules that prevent you from doing this.
It is crucial that the personal injury trust is set up as early as possible, preferably around the time of the first payment of compensation, usually called an interim payment.
There are different types of personal injury trust but the most common form is a bare trust. A bare trust means that the personal injury monies held within it are yours which you can demand at any time. The compensation is held in the name of a trustee who has the responsibility of looking after the compensation for you. Although not a legal requirement a professional such as a solicitor can act as your trustee.
For anything further, one of our specialists would be delighted to meet you either in our office or in your own home to talk through your requirements and answer any questions. Please contact us at any time.