Trusts for a Disabled or Vulnerable Beneficiary in Your Will

Why this needs thought

If someone you love is disabled or vulnerable, you will want your will to help them for the rest of their life. Leaving them money outright can sometimes do the opposite.

A trust in your will can provide for them more safely. This guide explains why, and the choices to consider. It is general information about the law in England and Wales, not advice on your own situation.

Why leaving money outright can cause problems

Means-tested benefits

Means-tested benefits are benefits that depend on a person's income and capital. Capital means savings, investments and other assets. An inheritance that belongs to someone outright counts as their capital.

For example, Universal Credit is not available to someone with capital of more than £16,000. Capital between £6,000 and that limit reduces it. Other benefits, and council help with care costs, have their own capital limits.

So a gift meant to improve someone's life could stop their benefits until most of it is spent.

Source: GOV.UK, Universal Credit: eligibility, checked October 2026.

Managing the money

Some people find it hard to manage a large sum, or are at risk of being pressured or exploited. A lump sum in their own name can make them a target.

If they lack the mental capacity to manage money, someone may need to apply to the Court of Protection to become their deputy. That takes time and costs money.

Source: GOV.UK, Become a deputy: fees, checked October 2026.

Leaving it to a relative informally

Some people leave the money to another child or relative, trusting them to look after their brother or sister. This is risky. The money legally belongs to that relative.

It could be lost in their divorce, claimed by their creditors, or pass under their own will. Nothing makes them use it as you intended.

How a discretionary trust can help

In a discretionary trust, your trustees hold the money for a group of people that includes the person you want to protect. They decide when and how to use it.

A beneficiary of a discretionary trust has no right to the trust fund, because the trustees cannot be made to pay them (paragraph H1238). DWP guidance for Universal Credit counts a person's rights to capital under a trust as their capital (paragraph H1196). A discretionary beneficiary has no such right, so the trust fund is not their capital.

Source: Department for Work and Pensions, Advice for Decision Making, Chapter H1: Capital, checked October 2026.

The trustees can then help in ways that make a real difference, such as:

• paying for equipment, holidays, activities or therapies
• paying for a better or more suitable home
• topping up care or support
• helping with things the person would struggle to arrange alone

Payments the trustees actually make are different. They may count as capital or income, depending on the benefit and what the payment is for. Trustees should check the rules for that benefit before making payments.

A letter of wishes

Your letter of wishes can tell the trustees about the person's needs, routines, likes and dislikes. It can name people who know them well. It is not binding, but it helps your trustees act as you would have.

Choosing trustees

This trust may last for decades. Choose people who are younger than you, organised and trustworthy, and who know the person well. Many families add someone independent. We recommend at least two trustees.

A disabled person's trust: special tax treatment

The law gives some trusts for disabled people a kinder tax treatment. To qualify, the trust must meet strict conditions.

Who counts as disabled for this

The law sets out who counts. The main group is people who receive one of a list of disability benefits. The list includes Personal Independence Payment, Attendance Allowance, and Disability Living Allowance at the middle or highest care rate or the higher mobility rate. Some people who would be entitled to one of these, but do not receive it, also count.

People who cannot manage their affairs because of a mental health condition can also qualify. The test is applied when the property goes into the trust. For a trust in your will, that is the date of your death.

Source: GOV.UK, Trusts and taxes: Trusts for vulnerable people, checked October 2026.

Inheritance tax

During the person's lifetime, anything the trustees pay out must be for their benefit. The trust can allow a small amount for others, up to the lower of £3,000 or 3% of the trust fund each year.

If the trust qualifies, it is treated as if it belonged to the disabled person for inheritance tax. So:

• there are no ten-yearly charges and no exit charges
• when they die, the trust counts as part of their estate for inheritance tax
• if the trust is for your own child or grandchild, your home left to it can still count for the residence nil rate band

Source: legislation.gov.uk, Inheritance Tax Act 1984, section 89 (Trusts for disabled persons) (Latest available (revised) version), checked October 2026.

Income tax and capital gains tax

Trustees of a qualifying trust can make a Vulnerable Person Election. The trustees then pay only the income tax the disabled person would have paid on that income, and a similar rule applies to gains. This saves tax whenever the person's own rates are lower than trust rates, which depends on their other income.

The trade off

These conditions make the trust less flexible. The money must be used for the disabled person during their life, so the trustees cannot freely help other family members.

Sometimes an ordinary discretionary trust is the better choice, even with its tax charges. Which works best depends on the person, their benefits, the size of your estate and the rest of your family.

Trusts for other vulnerable people

Someone does not have to be disabled to need protection. You may worry about a beneficiary with an addiction, a history of debt, or a difficult relationship.

A discretionary trust can help here too. The special tax rules above apply only to a disabled person as defined above, or to a child under 18 whose parent has died. For anyone else, the ordinary trust tax rules apply.

How GetWill handles this

A trust for a disabled or vulnerable person needs advice before your will is drafted. With GetWill, it starts with a professional consultation.

If you and your partner are making mirror wills, you stay on the mirror will service and our team contacts you about the trust. If either of you lives outside the UK, you start with a professional consultation instead.

The consultation is £150, including VAT. It includes a legal professional’s review of your circumstances and advice on the will you need. Afterwards we send you a written fee estimate for your will. If you go ahead, the £150 is deducted from that price.

In the questionnaire, you can tell us that someone who may inherit needs extra protection. Fifty Six Law reviews every will before it is finalised.

What to do next

• Note which benefits the person receives, or may be entitled to, and any care they receive.
• Think about who knows them well and could be a trustee.
• Start jotting down notes for your letter of wishes.
• Start with a professional consultation
• Making mirror wills with your partner: start your mirror wills
• More about trusts: Discretionary trusts in wills and Trusts in Wills

Last checked against official sources on 14 October 2026.