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Disabled & Vulnerable Persons Trust

A vulnerable and disabled persons trust can be made through a person who is disabled or a third party can take over on behalf of the disabled person. The important requirement is that the individual must be disabled so that they can apply for this trust.


When the disabled person begins to receive this trust it is the trusts job to safeguard their benefits alongside their inheritance and if the individual passes away then their inheritance goes into a discretionary trust.


Some of the trusts disabled people and children can receive are named 'trusts for vulnerable beneficiaries' and will also gain special tax treatment.


If you want to claim an income tax and capital gains tax the person looking after the vulnerable person has to fill out an Vulnerable Person Election Form. 


If the vulnerable person has passed away or are no longer vulnerable then the trustees must inform HMRC. 


Income Tax- this is a trust which the trustees are entitled to have their income tax deducted whilst caring for the vulnerable person.


Capital Gains Tax- trustees will be responsible to a capital gains tax if the trust is made for the vulnerable person, later on trustees will be able to claim a reduction. 


Inheritance Tax- if a trust was set up before the 8th of April 2013 half of the payments which are paid from the trust have to go to the disabled person.


If a trust was set after the 8th of April 2013- all the payments have to go to the disabled person except £3,000 or 3% of the assets that if it is lower and can be used for someone else's benefits.

How to claim special tax treatment?

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Innovation Way, Barnsley, S75 1JL

0330 383 0027

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