If you or your partner receive means-tested benefits or a local authority funded care package then you should consider setting up a Personal Injury Trust (PIT) to hold compensation received as a result of an accident or criminal injury.
The main benefit of using a PIT is that funds held within it will be disregarded when you apply for means-tested benefits. This means you will continue to get benefits and can spend the compensation as you choose. It may also protect your compensation if you require a local authority funded care package.
There are some other good reasons to consider the use of a PIT:
How do Personal Injury Trusts work?
Ideally, you should set up the PIT before you receive your compensation (or any interim payment) or as soon as possible afterwards. However, for many people, it can be done at a later date. You can usually appoint yourself as a trustee but this should be alongside at least one other person. Depending on the type of trust structure used, you can retain control and the ability to bring the trust to an end if you wish. You can also add and replace trustees.
Your trust must be managed by people you trust and can rely on. If you don’t have anyone you feel able to appoint as a trustee or you’re due to receive a large compensation payment, and don’t want to tackle the trust administration yourself, you might want to consider appointing a professional trustee like Cairn Trust Management.
We normally worked on a fixed fee and if you receive benefits then the Trust will pay for itself within weeks.
If you are considering setting up a PIT, please get in touch and we can give you an idea how best to take things forward.