At Nelsons, we assist many of our clients with creating Personal Injury Trusts and setting up Trust bank accounts. This blog outlines what a Personal Injury Trust is, how they work and the role of Trustees.
What is a Personal Injury Trust?
A personal injury trust is a legal document which allows any compensation you receive as a result of an accident or injury to be disregarded when you are assessed for means-tested benefits. Setting up a Personal Injury Trust helps retain your compensation and ensures you receive the benefits you are entitled to.
How does a Personal Injury Trust work?
A Personal Injury Trust is created in order to receive compensation as a result of your accident or injury. Instead of receiving compensation directly, the funds will be held by your trustees on your behalf via a bank account which is opened by your trustees. To remain eligible for state benefits, your compensation should be placed in the Trust bank account and held separately from your personal account.
Who should be my Trustees?
You should choose at least two trustees who are able to make responsible decisions on your behalf. These are individuals who will be legally responsible for looking after your compensation award. You can choose relatives, close friends or a professional such as Nelsons Solicitors Trust Corporation Limited.
What is the role of my Trustees?
The role of your trustees is to look after your compensation, they must act in your best interests and ensure the funds are used for your benefit. Although trustees have control over your compensation award, they cannot use it for their own benefit. You can access funds from your Trust at any time as long as all trustees agree.
How can I use the money in my Trust?
It is your choice how you spend the money in your trust but typical examples which would not affect your benefits are the purchase of personal possessions for example properties, cars, holidays and clothing. The funds cannot be used for regular expenses that your benefits are meant to cover such as Council Tax, gas, water, and electricity.
How Nelsons can help 
Chelsea-Ann Read is a Paralegal in our expert Court of Protection team.
At Nelsons, we provide support to clients to create Personal Injury Trusts and set up Trust bank accounts. If you have any questions in relation to the subjects covered in this article, please do not hesitate to contact Chelsea-Ann or another member of the team for further guidance on 0800 024 1976 or via our online enquiry form.
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