Disabled Persons Trust
If you’re leaving an inheritance to someone who is vulnerable or disabled, a trust can help protect both them and their future. It provides financial security while ensuring they continue to receive the care and support they need.
A Disabled Person’s Trust is a special type of trust designed for this exact situation. It offers better tax treatment than a standard discretionary trust (as long as certain conditions are met) and ensures that any means-tested benefits remain unaffected.
With trustees managing the inheritance, you can be sure that your loved one is looked after properly—even if they’re unable to handle their finances themselves. It’s a simple way to provide long-term security and peace of mind.
What are the benefits?
State Benefits
A Disabled Person’s Trust helps safeguard a vulnerable person’s inheritance while ensuring they continue to receive their means-tested benefits. Because assets held in the trust aren’t counted in financial assessments, your loved one can still access essential support while benefiting from the inheritance you leave behind.
It’s a simple way to protect their future without disrupting the help they rely on.
Keeping Control
A Disabled Person’s Trust ensures that your loved one’s inheritance is managed by trusted individuals, protecting them from financial risks or exploitation.
If they struggle to handle money or make complex decisions, the trustees can step in—making sure funds are used in their best interests while keeping everything safe and secure.
Tax
A Disabled Person’s Trust comes with favourable tax treatment compared to a standard Discretionary Trust. It can reduce liability for Inheritance Tax, Capital Gains Tax, and Income Tax, meaning more of the inheritance goes to your loved one, rather than to HMRC.
Succession Planning
With a Disabled Person’s Trust, you can control where any remaining assets go after the beneficiary passes away. Instead of assets being automatically distributed, they will pass to the people you choose, such as other children or grandchildren, ensuring your wishes are followed
Simplicity
A Disabled Person’s Trust is designed to be easy to set up and manage, with minimal ongoing administration. This ensures that the beneficiary receives the support they need without adding unnecessary complexity for trustees