Personal Injury Trusts
Protecting your assets and benefits after a compensation pay out
Compensation is the mechanism by which society helps victims of personal injury or medical negligence. Its role is to replace lost income and help people who need long term care and support.
But the payout can also lead to some people missing out on benefits they are entitled to, unless they take action to protect their finances.
Here at Vincents specialists from each of our different departments – personal injury, medical negligence, Court of Protection and Private Client – work together to ensure clients receive the very best advice and support in this regard.
You can come to us at any stage in your journey to benefit from our extensive expertise.
If someone has successfully claimed compensation for personal injury or medical negligence, we would speak to them about setting up a Personal Injury Trust.
This is particularly important for anyone who previously received means-tested benefits or who should be in receipt of benefits following their injury.
The government’s benefit assessment could take into account the money received in the compensation payout, and determine benefits are therefore no longer needed.
This could see a reduction in, or even a demand for repayment, of housing benefit, income support, Jobseekers Allowance, and child benefit.
But a victim of an injury should still be entitled to those benefits, despite the payout they have fought hard to receive.
How does it work
If you have between £6,000 and £16,000, your means-tested benefits will be reduced.
If you have more than £16,000 you will not be able to claim means-tested benefits at all.
However, if you place your compensation into a trust, this amount is disregarded when assessing the amount of capital you own and you can still have access to your compensation.
There are different types of trusts that can be used when setting up a Personal Injury Trust, with their own tax regimes, these include:
Life Interest Trust
Your personal circumstances and the amount of compensation you receive will determine which trust best suits your needs.
Personal Injury Trusts may also be recommended for long term planning for thigs like:
Funding care home fees
Claiming means-tested benefits in the future
Protecting your compensation from divorce or bankruptcy
Protecting your compensation for friends and family.
Not only will we help you to set up the right trust for your needs, to protect your assets now and in the future, but we can also help you to apply for the relevant benefits you are entitled to.
Vincents Solicitors is fortunate to have an in-house welfare advisor who will work with your private client specialist or your personal injury / medical negligence solicitor to ensure you have access to the appropriate benefits to support you now and in the future.
For further information contact Patricia Prescott on PatriciaPrescott@vslaw.co.uk or call the Lytham office on 01772 348922.