Have you received compensation from a personal injury or medical negligence claim? If so, you should consider setting up a personal injury trust to protect this.
Please see five good reasons to set up a personal injury trust below as well as some personal injury trust FAQs.
As we live longer, it becomes more likely that we will need assistance with our care. The ever-increasing costs of care mean that many will need to seek Local Authority assistance with payment of the fees.
If your compensation is held in a personal injury trust , you can receive Local Authority funding and still benefit from the funds held in your trust.
By comparison, if the compensation is held in your own name, you may need to use the compensation funds towards the cost of your care.
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As house prices increase many more estates will suffer the burden of inheritance tax.
If your compensation is placed into certain types of trust it will not be included in your estate for inheritance tax purposes after seven years.
By comparison, if you hold the compensation in your own name, the value of your estate will be increased, and the tax payable on your death may be greater as a result.
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If you or your partner are claiming any type of means-tested benefits, or might wish to do so in the future, and the compensation is held by you personally, you may lose your entitlement to benefits.
If the compensation is placed into a personal injury trust, it is entirely disregarded in the calculation of your entitlement to benefits. The trust funds can be used to pay for expenses such as cars, holidays and household goods.
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The person who was intended to benefit from the compensation award is you. On divorce, all the financial resources of each party can be taken into account in determining how the assets are divided.
If your compensation is clearly ring-fenced and held in a personal injury trust, it will be easier to argue that the fund should be retained by you, and not included in the pot of assets to be divided.
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Your compensation was awarded taking into account your future needs. You may come under pressure from family or friends to use the funds to benefit others. The trustees of a personal injury trust can help to protect your compensation, so that it is set aside to meet your needs, whatever the future may bring for you.
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Our extensive legal expertise enables our personal injury solicitors to recover millions of pounds in compensation every year, whilst at the same time providing a friendly and approachable service to clients nationally.
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