Personal Injury Trusts
Until the introduction of the Income Support (General) Regulations (Northern Ireland) in 1987 it had always been a source of inequity that means tested benefits claimants (i.e. those in receipt of Income Support, Housing Benefit, and other “piggy-back” benefits such as free prescription charges, and health care costs) had their benefits - usually their only source of income - reduced or withdrawn completely on receipt of a Personal Injury Award. As a result the Personal Injury Award was in practice used, not to meet needs arising from their personal injury, but to replace this lost income.
By comparison, those whose income exceeded the means tested benefits thresholds in the first place had freedom to use their Personal Injury Award to meet needs that had arisen as a result of the personal injury, or indeed for whatever purpose they chose.
The Regulations introduced the concept of a Personal Injury Trust as a means of protecting means tested benefits on receipt of Personal Injury Awards thereby placing all claimants on an even footing. They also allow for the Personal Injury Award to be disregarded for the purposes of the analogous but separate financial assessment for residential care or nursing home fees.
It is thus vital for any current means tested benefits claimant, or one likely to be entitled to means tested benefits in the future, or anyone liable to require residential or nursing accommodation in the future, to consider utilizing a Personal Injury Trust to administer any Personal Injury Award that they receive.
We can provide an all-inclusive package of advice and assistance to the Personal Injury Award recipient, including:
- Providing general advice in respect of the advantages and disadvantages of a Personal Injury Trust arrangement; the types of trust vehicle; the successful operation of the Trust to protect means tested benefits; tax implications of setting up a trust and the impact on means tested benefits
- Liaising with Counsel to draft a suitable Personal Injury Trust deed for the individual Personal Injury Award recipient
- Providing Professional Trustee services in cases of large awards
- Liaising with Benefits Agencies, Banks etc. to provide an explanation of the Personal Injury Trust arrangements
- Dealing with any queries arising in respect of the continuing operation of the Personal Injury Trust
- Providing ongoing tax advice and tax services for the continuing operation