personal injury services personal injury trusts what is a personal injury trust?
What is a Personal Injury Trust ?
Many personal injury claimants are in receipt of welfare benefits. If they do not receive appropriate advice about the use of Personal Injury Trusts, their benefits may be affected when they receive their damages. Legal advisers have a duty to inform claimants of the option to set up a Trust in order to protect their benefits situation.
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Where a trust fund has been set up out of damages paid as a consequence of a personal injury (a Personal Injury Trust), the value of the trust is ignored for the assessment of eligibility to most means-tested benefits and/or local authority support, such as Income Support, Housing Benefit and Council Tax Benefit. Personal Injury Trusts are also sometimes referred to as Special Needs Trusts or Trusts for the Disabled. Whatever term is used, it is the source of the trust fund which determines the trust's nature. Trusts of this type may include bare trusts, interest in possession trusts and discretionary trusts. Sometimes they are used in combination. It is important to ensure the correct type of trust is used. This will depend on the claimant's needs, family circumstances and the possible involvement of the Court. The correct form of trust should enable claimants to retain their entitlement to most means-tested state benefits and/or local authority support irrespective of the size of their award. Click here to download our 'Personal Injury Trusts -Frequently Asked Questions' brochure . Click here to visit our library for relevant articles and information about Personal Injury Trusts The Financial Services Authority do not regulate taxation or trust advice. |
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