Skip to main content

Personal Injury Trust

If you have received compensation as a result of a personal injury, you should consider establishing a Personal Injury Trust.

If you are in receipt of means-tested benefits and do not put the award into a Personal Injury Trust, the compensation award could mean that your benefits are either reduced or completely stopped. Even if you are not currently receiving benefits, putting the award in trust would mean that if you do require them in the future, the compensation would be disregarded when assessing your benefit entitlement.

Also, a Personal Injury Trust can be useful if you have a significant compensation amount and would like the help of others to ensure that it is managed properly.

Frequently asked questions

The following are some of questions we are often asked about Personal Injury Trusts.

Any trust that receives funds as a result of a personal injury and that is set up by the injured person can be classed as a ‘Personal Injury Trust’.

As there is no one type of trust that is a Personal Injury Trust, the first step is to meet with a Solicitor in order to discuss the different types of trust that can be used and which type would be most suitable for your circumstances.

You would then need to select your trustees (see ‘Who can be a trustee of a Personal Injury Trust?’ below). We would normally recommend that at least three trustees are selected to ensure that a majority decision can always be reached.

In order to formally set up the trust, your Solicitor would prepare a Trust Deed and it would signed by you and your trustees. Your compensation award would then be transferred to the trust for your trustees to administer for your benefit.

A Personal Injury Trust might be suitable for anyone who has received compensation as a result of:

  • Medical negligence causing injury
  • Criminal injuries
  • Accidental injuries
  • Disease or injury caused as a result of disease

If you think you have grounds for a personal injury claim, our expert Personal Injury Solicitors can advise you on your situation and help you through the whole claims process.

You can put the entire amount of compensation that you receive as a result of a personal injury into a Personal Injury Trust.

Anyone who is over the age of 16 and mentally capable can be a trustee of a Personal Injury Trust. It is possible for the injured person setting up the trust to also be a trustee.

No. One of the main advantages of putting compensation received as a result of a personal injury into a Personal Injury Trust is that the assets held within the trust fund will be disregarded for the purposes of assessing your ability to claim means-tested benefits.

However, your trustees will have to be careful when making payments from the trust fund to you that they do not exceed the maximum limits permitted when claiming means-tested benefits.

Yes. Once the trust has been established, the trustees must administer the trust funds for your benefit. They are responsible for deciding when to make payments to you. They are also responsible for paying any tax and ongoing expenses for the trust. The level of administration varies depending on the type of trust chosen.

Trustees have a number of duties when administering the trust, such as duties to meet regularly, to keep an account of their actions and to act in your best interests.

Depending on the type of trust used, your Personal Injury Trust will either end on your death or it can continue on after your death in order to benefit your family. However, if appropriate, the trust can be brought to an end before this.

How can Thorntons help?

If you are due to receive, or already have received, compensation as a result of a personal injury, our expert team of Private Client lawyers can provide you with legal advice and guidance on all of your options and how best to proceed in your circumstances.

We can advise you on the most suitable form of trust in your circumstances and provide you with a bespoke Trust Deed. We can also assist you and your trustees with the ongoing administration of the trust.

We work closely with our experienced Personal Injury Solicitors and understand how stressful a time this can be for all involved. With our knowledge, expertise and experience, clients can be assured that we will support them throughout the process, from raising the personal injury action to settling the compensation award into a Personal Injury Trust.

Call the Thorntons Private Client team on 03330 430 150 to find out more about Personal Injury Trusts. Or complete our enquiry form and we will contact you.