Court of Protection Deputyships and Personal Injury Trusts
The Court of Protection deals with the management of the property and financial affairs together with health and welfare decisions of people who have difficulty or lack the ability to deal with this themselves.
Our Court of Protection Solicitors are experts in managing the property and affairs for people who need assistance to make decisions and those who completely lack mental capacity to manage their finances themselves.
When someone lacks mental capacity to look after their own affairs and has not put in place a Power of Attorney before losing capacity, the Court of Protection will appoint a Deputy to look after that person’s affairs. The Deputy must act in that person’s best interests and follow the rules of the Mental Capacity Act.
Our Court of Protection deputies work closely with you, your family, friends and carers to deal with the management of your personal affairs.
We can help you to access the information to help you to make to sound decisions to secure your finances and other affairs for future long term needs and to protect investments for vulnerable individuals. We can also help you to find the right advice on investment and protection for large compensation awards.
This experience is vital in ensuring that we are always acting in your best interests and comply with the Mental Capacity Act 2005 every time a decision is made. It is essential in every large claim that careful consideration is given to the financial, social and welfare issues as well as legal matters throughout the process.
The Court of Protection deputy can assist with matters such as the sale or purchase of property, the making of wills and family law matters.
If someone lacks mental capacity and they have never made a Will or their Will is out of date we can ask the Court of Protection to make a Will for them, known as a Statutory Will.
Our Court of Protection Solicitors can provide legal advice about what options are available and whether a Court application is suitable.
What is a Personal Injury Trust and why do I need one?
A Trust might help to protect any current or, perhaps future entitlement to Means-Tested* State Benefits and/or Local Authority Support.
No one knows when they may need to call upon state support, following a redundancy, an accident, or a sudden illness.
Having savings or receiving a lump sum of money can affect your entitlement to certain means tested state benefits and supports. If you have ‘too much’ money you may have no entitlement at all. This money is known as your “capital threshold” and is calculated per household. This means that if your partner requires Means-Tested* State Benefits/Support any capital that you have may also affect their entitlement.
Awards of personal injury compensation that are held in a Personal Injury Trust are disregarded when assessing entitlement to means-tested state benefit or support. There is no maximum amount of money that be placed in a Personal Injury Trust, the only condition is that only compensation received arising from an injury can be placed in the Trust.
Once you receive an award of personal injury compensation you have a period of 52-weeks from the date or the first payment (which may be an interim payment) to set up a Personal Injury Trust. After this period if you receive Means Tested* State benefits your compensation award counts as capital when assessing your entitlement and you may lose your benefits.
Whether or not you chose to set up a Personal Injury Trust you are under a duty to notify your local Benefits agency about your compensation award if you claim benefit but any money held in a Personal Injury Trust will be disregarded.
So you think you need a trust…
The type of trust that is needed differs from one person to another depending on your needs, family circumstances and possible involvement of the Court.
Instead of any compensation being paid directly into your own bank or building society account a Trust is established and your money is held by your chosen Trustees on your behalf.
The Trustees will open a Trustee bank account which will be run by the Trustees on your behalf. The Trustees will look after the money in the account according to your wishes and a set of rules, which are designed to protect you.
Your Trustees should be people that you trust. That may be family, friends, a solicitor or a trust company but it is your choice. It is preferable to have at least two Trustees and they must be over the age of 18. If, for whatever reason, your chosen Trustees are unable or unwilling to continue, you can replace them.
Your chosen Trustees administer the Personal Injury Trust for your benefit. Although your Trustees hold and have control over your compensation award, they cannot use it as their own personal property or for their own benefit.
Trustee banking facilities will include a Trust cheque book. All Trustees need to sign any cheques that issued on your behalf from the Trust fund. You should bear this in mind if you choose more than two Trustees or choose Trustees that live a considerable distance from each other.
If at any time you decide you no longer need the Personal Injury Trust, you should write to your Trustees instructing them to transfer the money over to you. The Personal Injury Trust will then cease. Any money then paid over to you would be taken into account in any assessment for Means-Tested* Benefit/Support.
The money held in the Personal Injury Trust is usually taxed in exactly the same way as if you held the money in your own account.
If you die, the value of your Personal Injury Trust would be distributed in accordance with the terms of your Will. If you die without making a Will, you may not control who would receive your award money. Your estate would be distributed in accordance with a set of legal rules.
So how does the trust work?
Ideally your Trustees should pay you varying amounts at irregular intervals from your Trust. You should ensure that any payment does not exceed the relevant capital limit if you are in receipt of Mans-Tested* benefit or support or are likely to need to claim before the money is spent.
If you require money to pay for more expensive items or to repay debts, it is simpler to ask your Trustees to pay these directly from the Personal Injury Trust.
Talk to us…
Our experts can help you to decide whether a Personal Injury Trust is right for you. We will guide you through the process, including providing a suitable Personal Injury Trust document and helping your Trustees to set up a trustee bank account. We can also advise your local benefits agency that a Personal Injury Trust has been established.
Capital held within a Personal Injury Trust is also usually disregarded from the Means-Test for residential care and other forms of Health/Local Authority support including care in your own home.
Other things you should know
After the 52 week grace period, if you then deliberately deprive yourself of money in order to claim or increase your Means Tested State Benefit/Support, the benefits agency may treat you as if you still had the money in your possession and control. In those circumstances, not only will you have you given your money away, but you would also be likely to lose your entitlement to Means Tested State Benefits.
If you receive an award of compensation in respect of a personal injury, you are able to protect both your current and future entitlement to certain State Benefits, Local Authority assistance and/or other sources of state assisted help by placing your damage into a Personal Injury Trust.
When does a Personal Injury Trust need to be set up?
Although the benefits agency will usually give you a period of 52 weeks from when you first receive either an interim or final settlement, it is often best practice to set up a Trust as soon as possible.
* Not all benefits are means-tested.
If you need more information about setting up a personal Injury Trust or having the support of the Court of Protection call us on 01285 654875 or email us at email@example.com