A personal injury trust account in the UK is a special type of bank account used to hold compensation received for a personal injury claim, such as damages from an accident, medical negligence, or other injury-related cases. The primary purpose of a personal injury trust is to ensure that the compensation does not affect the injured person’s eligibility for means-tested benefits or care support.
Key Features of a Personal Injury Trust:
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Exemption from Means-Tested Benefits:
- Without a trust, compensation could be counted as part of your financial assets. If your total assets exceed a certain threshold (e.g., £6,000 for certain benefits), this might reduce or disqualify you from receiving benefits.
- Funds held in a personal injury trust are disregarded for means-tested benefits purposes as long as the trust is correctly set up.
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Protection of Funds:
- A trust protects the compensation from being spent unintentionally or accessed by creditors, family members, or others.
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Set-Up Timeframe:
- It’s recommended to set up the trust within 52 weeks of receiving the compensation. During this period, the compensation is generally disregarded for means-testing purposes, even if a trust isn’t yet in place.
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Trustees:
- The trust requires trustees, who are individuals responsible for managing the account. Typically, you (the injured party) can be a trustee, but it’s advisable to appoint at least one or two other trustworthy individuals, such as family members or professionals.
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Types of Trusts:
- The most common type used for this purpose is a bare trust (simple trust), where the injured person retains full control over how the funds are used, but the funds are still legally held in trust.
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Uses of the Funds:
- The funds can only be used for your benefit, such as medical care, housing adaptations, or general living costs. However, trustees should ensure the spending aligns with the trust’s purposes.
The Personal Injury Trust Account from Money Carer
Professionals such as solicitors, independent financial advisors (IFAs), and family trustees can open a personal injury trust bank account on the Monika banking platform within minutes. The account can then be used to receive deposits and make payments from a bank account to support the beneficiary in line with the trustee’s fiduciary responsibilities.
As Money Carer has a unique and long-established relationship with Zempler Bank, trustees can immediately benefit from the banking services technology and payment innovations developed by Money Carer and used by hundreds of law firms and local authorities to help them fulfil their fiduciary duties in supporting the vulnerable people under their care.
To open a personal injury trust bank account, simply contact us.
