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Personal Injury & Compensation Trusts

Our team can advise you on how to protect any payment you may receive either under a personal injury award or a compensation payment, for example, from a medical negligence claim.

By using a trust you can protect the award from future financial attack and appoint trusted family members or friends to help you manage any payment. There are different types of trust which can be used to hold any award and the type of trust you need will vary depending upon your circumstances and the value of any award. Our team can help you and your family decide which type of trust is most appropriate. We can draft the trust for you and advise your trustees on how to properly administer the trust in the future.

The main reason why such trusts are used is to protect any means-tested benefits which you may be in receipt of. If you receive an award and it is not held under the terms of a trust this will be taken into account in the assessment of your benefits. This means you may lose any entitlement to benefits which you currently receive or may mean that in the future you are not eligible to receive benefits which would otherwise have been available to you.

If you create a trust to hold your benefits, the capital value of any award will be disregarded when assessing your entitlement to benefits.

The use of a personal injury trust could become increasingly important as your circumstances change. For example, if your compensation is held under the terms of a trust, the capital value may not be taken into account if you need to fund residential care. This does depend upon the terms of the award which you receive.

Ideally, the trust should be created before you receive your personal injury award or compensation payment. However, this is not essential. You can create the trust at any time using your compensation payment. If you have already received your award and have not created a trust, the capital should still be disregarded in any assessment during the first 52 weeks although there are exceptions to this.

We can advise you on when it is appropriate to create a trust, how this can be achieved, the type of trust you should use, the on-going administration of the trust and also work with your accountant and any financial adviser to ensure the trust works effectively for you.

For further information or advice, please contact Alison Hall on 0191 232 8345 or email Alison.Hall@hay-kilner.co.uk


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