No, is the answer, but if you are claiming benefits, your benefits will be reduced until you set up a trust.
This question is usually asked by those who have received compensation and were not claiming benefits at that time. Some benefit claimants receive compensation, not knowing a trust could be set up. Also, you might be about to receive compensation and are not sure if you will ever need to claim financial support from the state.
If you are currently claiming means tested benefits, a trust should be set up within 52 weeks of first receipt of compensation. That means receipt by you or your solicitor, although benefit agencies tend to concentrate on you. You can hold compensation for 52 weeks and it will be ignored.
If you do not set up a trust within this 52 week period, your compensation will count against your benefit entitlement. This does not prevent you setting up a trust after that 52 week period, but it means your compensation will be taken into account against benefits until a trust is set up.
For those claiming benefits, there is no point in delaying a trust, as you cannot spend the compensation within those 52 weeks, you can only hold it.
You can only pay personal injury compensation into a trust, so as time passes, the greater will be the difficulty identifying the compensation. If someone not claiming benefits thinks a trust may become necessary, but does not want to set one up now, I suggest the compensation should be held separately from other funds.
If you hold compensation without a trust and you need to claim benefits, be sure to set up a trust before you make the benefit claim.
We tend to concentrate on the protection of means tested benefits, but do not overlook that a personal injury trust keeps compensation outside the financial assessment for local authority care. If you received compensation 20 years ago and now need care, a trust can be set up for the compensation, if you can show you still hold it.