law for life
Understanding the Challenges
When a disabled or vulnerable individual inherits assets directly, several challenges can arise. A sudden increase in personal wealth may disqualify them from receiving essential means-tested state benefits, such as income support or housing assistance, which are often vital for their daily living and medical needs.
Additionally, some individuals may lack the capacity to manage significant financial resources effectively, increasing the risk of financial mismanagement or exploitation. Without proper safeguards, inherited assets may be more susceptible to claims from creditors or may not be utilised in a manner that aligns with the beneficiary’s best interests.
The Role of Trusts in Protecting Vulnerable Beneficiaries
A trust allows assets to be held and managed by appointed trustees on behalf of the beneficiary, ensuring that the funds are used appropriately and in the beneficiary’s best interests. One effective vehicle is a Vulnerable Person Trust, also known as a Disabled Person’s Trust.
This specialised trust is designed to benefit individuals who meet specific criteria under the Mental Health Act 1983. It offers favorable tax treatment and provides a structured framework for managing assets, thereby safeguarding the beneficiary’s financial future.
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How Franklins Solicitors can Assist
At Franklins Solicitors, we recognise the considerations involved in providing for disabled or vulnerable beneficiaries. We offer more than 40+ years of experience in handling and managing complex estates.
Our solicitors are adept at drafting and establishing various types of trusts, including Vulnerable Person Trusts, ensuring compliance with legal requirements and optimising tax efficiency. We also offer ongoing support and guidance to trustees, assisting them in fulfilling their duties effectively and in accordance with the trust’s terms.
