Vulnerable Person Trusts
Helping you to create trusts that protect those who need it most
Protecting the future of your loved ones
Planning for the future is never easy, especially when a loved one has a disability or additional needs. We know how important it is to provide security, stability and peace of mind. A Vulnerable Person Trust (VPT) is designed to do just that.
Our solicitors specialise in trusts for vulnerable beneficiaries, combining technical expertise with a sensitive, supportive approach. We’ll guide you through every step, from establishing the trust to choosing the right trustees.
Get in touch with our friendly team today to discuss whether a Vulnerable Person Trust could be right for your family.
Key considerations when setting up a trust for a vulnerable person
Creating a vulnerable person’s trust is a valuable way to protect your loved one’s future, but it’s not a decision to be taken lightly. There are several important factors to think about before moving forward.
- Who will act as trustees?
- What assets will be placed into the trust
- How will the trust interact with existing benefits and entitlements?
Our solicitors will work closely with you to ensure your trust is robust, effective, and fully tailored to your circumstances.
What is a Vulnerable Person Trust?
A Vulnerable Person Trust is a legal arrangement that allows family members or carers to set aside money, property, or investments for a vulnerable or disabled person. The trust is managed by appointed trustees, who are responsible for using the funds in the best interests of the beneficiary.
The trust is managed by appointed trustees, who have a duty to use the funds in the best interest of the beneficiary. Importantly, it can also offer favourable tax treatment compared to standard trusts.
Who qualifies for a Disabled Persons Trust?
Not everyone can benefit from this type of trust. To qualify, the beneficiary must fall into one of the following categories:
They receive certain disability-related state benefits, such as:
- Disability Living Allowance (middle or higher rate care component)
- Personal Independence Payment (daily living component)
- Attendance Allowance
- Armed Forces Independence Payment
- Constant Attendance Allowance
They are unable to manage their financial affairs due to a mental disorder, as defined under the Mental Health Act 1983.
For the trust to benefit from the favourable tax treatment, the majority of the funds must be applied for the vulnerable or disabled person. If you are unsure who qualifies for a Disabled Persons Trust, our expert solicitors can review your circumstances and provide tailored guidance.
Key benefits of a Vulnerable Person Trust
A Vulnerable Person Trust offers a range of advantages over other trust arrangements:
- Protects entitlement to means-tested benefits
- Ensures long-term financial stability for the vulnerable beneficiary
- Provides trustees with flexibility to use funds as needed
- Can reduce inheritance tax liabilities compared to standard discretionary trusts
- Peace of mind that your loved ones will be cared for in the future
Disabled Persons Trust vs Discretionary Trust
A common question is whether to set up a Disabled Persons Trust or a Discretionary Trust. While both structures offer protection and flexibility, the key differences are:
Disabled Persons Trust: Designed specifically for vulnerable beneficiaries, with potential tax advantages. The majority of the trust benefits must be applied for the vulnerable person.
Discretionary Trust: More flexible in terms of who can benefit, but without the same tax reliefs. These trusts may be more suitable if you want multiple beneficiaries to benefit, not just one vulnerable person.
Choosing the right option depends on your family’s unique circumstances. Our team will explain the differences so that you can make an informed decision.
Speak to a solicitor
Whether you are considering setting up a Vulnerable Persons Trust or need legal guidance on how it works, we are here to help. Our experienced solicitors can advise you on how to protect the interests of a vulnerable beneficiary and ensure their long-term financial security. You can call, email, or visit one of our seven offices to speak with a member of our team.
Call us
With seven offices around the South West of England, we have multiple offices you can call.
Email us
If you would like to drop us an email you can on info@goughs.co.uk
Visit us
With offices in Calne, Chippenham, Corsham, Devizes, Melksham and Trowbridge, you can pop in and see us. View office locations.
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Popular questions about Vulnerable Persons Trusts
In most cases, the trust will last for the lifetime of a vulnerable person. Careful planning is essential to make sure it continues to provide the right support for as long as it is needed.
You can appoint family members, friends, professionals, or a combination of these. Trustees should be people you trust to act responsibly.
The trust must mainly benefit the vulnerable or disabled person to qualify for favourable tax treatment. Other beneficiaries can sometimes receive support, but the vulnerable person must remain the primary focus.
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