What are the pros and cons of a personal injury trust?

To help you make your decision, I have set out the pros and cons of setting up a personal injury trust. For this comparison I will deal only with a bare trust.


  • Compensation ignored when assessing your entitlement to means-tested benefits.
  • Compensation ignored when assessing your entitlement to local authority funded care.
  • Compensated person can retain a level of control.
  • Compensation can be spent from the trust with few restrictions.


  • Compensated person must not have personal access to trust fund.
  • Trust must have a separate bank or building society account.
  • The trust must have at least two trustees.
  • Trust bank account requires signature or approval of at least two trustees.
  • There is a cost in setting up the trust (not as much as you think).
helping you decide if a personal injury trust is right for you

The significant benefit of a trust for personal injury compensation is the compensation and income received into the trust fund are ignored when calculating your entitlement to benefits. There is no legitimate alternative to a trust for personal injury compensation.

This is a very generous provision which accepts a payment following injury is not a windfall and is intended to cover an injury, plus past and future losses. To gain this significant benefit you should set up a trust and put up with the slight inflexibility involved in managing the trust fund. It is no more than a nuisance, but compare it to the advantages and the decision is clear.

If you are in receipt of benefits or care, or likely to be in receipt of benefits or care, a personal injury trust should be set up to hold the payment received in consequence of a personal injury.

Related Content

A personal injury trust is a positive thing, not a problem
Personal injury trust questions and answers
Personal injury trusts guide
Instruct me online


Protect your compensation

Receiving interim or final compensation payment?

You may need a trust to protect benefits and local authority care.

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