If you received monies as a result of a personal injury, which may include compensation, payments from the Criminal Injuries Compensation Authority, critical illness insurance policies or even donations from those wanting to assist you, then you may choose to place these monies within a Personal Injury Trust.
Why set up a Personal Injury Trust?
There are a number of potential benefits of a Personal Injury Trust including:
- Protecting your entitlement to means tested benefits or care funding as assets within a Personal Injury Tust are ignored for this purpose;
- To protect you from yourself and others – by having trustees who will monitor the expenditure of the money to help ensure that the best long term benefit from the money is gained, this can give you peace of mind that the fund is being managed in the best way possible;
- To place responsibility with those who may have better experience or expertise in dealing with investment and monies.
What is the best form of Trust?
A Personal Injury Trust can have a variety of terms and be one of a number of different types of Trust, for example it could be a Bare Trust (where the person receiving the compensation is the sole beneficiary) or even a Discretionary Trust where there is a pool of beneficiaries. We can go through these options with you to ensure that you pick the most suitable type of Trust for your needs and consider the different tax implications with you.
Can the injured person retain any control?
It may be possible for the injured person to retain some control based on the type of Trust chosen, including a power to change trustees and overriding right to terminate the Trust if you so require.
What happens if the injured person does not have capacity?
In such a situation it may be that a Personal Injury Trust is not suitable and that a deputyship may be the most appropriate arrangement. Our Elderly, Care & Mental Capacity team will be happy to assist in this matter.
If you would like to find out more about Personal Injury Trusts, please speak to a member of our team.
To read more about protecting your compensation and how to set up a Personal Injury Trust you can download our Compensation Protection Trusts guide