Whilst estate planning is always important, it can be even more critical for neuro disabled people and their families. The decisions you make can have significant implications for your loved one, affecting everything from access to essential benefits to how your wishes are carried out.
In this article, we explore some of the key considerations when estate planning for neuro disabled people. This includes those with learning disabilities, autism or an acquired brain injury.
1. Leaving gifts without affecting benefits
Parents and family members of neuro disabled people often want to leave gifts in their will to ensure their loved one is supported. However, if this is not carefully planned, the gift could have unintended consequences.
If one of your loved ones is neuro disabled and you wish to leave them a gift in your will, you should speak with a legal adviser to determine the most appropriate estate plan. Without doing this, there is a risk that your loved one could have their entitlement to Universal Credit, or other government allowances, limited.
If you are the parent or carer of a loved one, it may be wise to draft a Letter of Wishes to be read alongside the terms of your will. Here, you can go into more detail about your loved one’s preferences, and any other support needs they may have to ensure that they are cared for compassionately and in an appropriate, specific and personalised way.
2 Choosing trustees to support future needs
If you are making a trust in your will to support a neuro disabled loved one, it is important to appoint the right trustees. Trustees are the people responsible for administering your trust and putting the needs of the person with a learning disability at the heart of what they do.
These people should be prudent, loyal and impartial, helping ensure that your wishes, as set out in the trust, are fulfilled after you have passed away. Take your time to consider which people in your life would be best suited to the role, keeping in mind that it can be burdensome and there can be a lot of paperwork involved.
Always communicate these wishes to your prospective trustees when drafting your will to ensure they are aware of your intentions and let them know that they can seek legal advice if they need help managing the trust at any point in time.
3 Using trusts to protect financial security
If you would like to set up a trust for your loved one, their needs and circumstances should be considered carefully throughout the drafting process.
There are different types of trusts available, and choosing the right structure is important. The most appropriate option will depend on your loved one’s circumstances, the level of flexibility needed, how decisions about the trust should be made and any relevant tax or benefit considerations.
In many cases, a discretionary trust can be an effective way to provide for a loved one, whilst preserving flexibility for the trustees.
A discretionary trust gives the trustees discretion over how and when funds in the trust, and any income produced by it, are distributed. This means that the person with a learning disability does not have an automatic right to receive the funds. As a result, the trust may help protect their entitlement to means-tested benefits, as the assets are not treated in the same way as money held directly by them.
This also means that, when the person who benefits from the trust passes away, the value of the trust is not usually included within their own estate. This can help avoid inheritance tax implications for the people they may wish to leave assets to.
A disabled person’s trust is a largely similar structure. This may be more appropriate if the directions for the trustees are more set in stone, and less discretion is needed to make decisions about your loved one.
How Scott Bailey can help
Estate planning for neuro disabled people requires careful thought and tailored legal advice. At Scott Bailey, our Wills, Trusts and Probate team can help you understand your options and put the right arrangements in place for you or your loved one.
Whether you are making a will, considering a trust, preparing a Letter of Wishes, or dealing with a legacy that may affect benefit entitlement, our solicitors can provide clear, practical advice based on your circumstances.
This can be a sensitive and complex area of law, but with the right advice, you can make informed decisions with confidence. If you would like to discuss how we can support you or your loved one, please get in touch with our Wills, Trusts and Probate team.
From the Blog author:
Scott Bailey LLP is an award-winning, Lexcel-accredited New Forest law firm that has supported clients across Hampshire and beyond for over 90 years. The firm provides trusted advice to individuals and businesses on wills, trusts and probate, residential and commercial property, family law and divorce, litigation, corporate and commercial law, notarial services and more.
With offices in Lymington and Lyndhurst, Scott Bailey LLP has built a strong reputation across the region for its comprehensive expertise, personal approach and ability to support clients across a wide range of legal matters.
To learn more about Scott Bailey LLP, visit www.scottbailey.co.uk.