Inheritance protected so that benefits can still be claimed

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Can inheritance of around £200,000 be somehow protected so that benefits can still be claimed if provision is made in a will to hold that inheritance in some kind of trust? The claimant will never work for various reasons.

You should post this on the UC FB page. The moderators and admins have a lot of knowledge. There was a similar question asked yesterday and they received lots of helpful information

If somebody has 200K, they should never go back into 'poverty'. The interest, alone, would be sizeable.

Disabled people on means tested benefits absolutely should lose them if they’ve got £200k in the bank. If it’s ok to tell disabled people like me, who has a lifelong condition and will never work again, that I can’t have any means tested benefits because DH earns too much, then it should be the same for people who exceed the savings limit, regardless of how they got there.

Indeed. And so many defending it.

I'm not sure that's true. Rental hosing and general living costs would eat into the capital quite quickly, and the more capital is used up the less there is to generate interest.

@Houseplanter and @cringelibrarian the inheritance has been left in some kind of trust by the already deceased.

Yes - I've done it for a client in the past. A trust is the way forward but that comes with its own costs and complications.

Take some proper legal and financial advice.

Well if entitled to benefit eg pip the inheritance won’t affect it-but means tested, I get the impression the OP meant if there’s any way of hiding it so can still claim benefits. Hell no. It’s fraud and we would be paying for it.

Then it sounds like the carer who inherited is thinking of his disabled son's future after the carer himself passes away or gets too old to provide care.
If so, what's wrong with that?

Yes, if the person is vulnerable and disabled. I have one set up for my son who is disabled and will never earn enough to support himself.

https://www.scope.org.uk/advice-and-support/leaving-money-to-disabled-person-in-will-trust/?gad=1&gclid=Cj0KCQjwmvSoBhDOARIsAK6aV7gs_QL6iUNOsPDYEb2j2CDI8Dl6Y4Hf9Qm9fFx1532D9gVHvrgkKpIaAnEVEALw_wcB

It's about protecting inheritance, not providing for the individual whose money this is.

Yes, in a Trust, My brother has very severe disabilities and this is what my parents have done. (Also, it's kind of necessary anyway if someone doesn't have capacity to manage financial matters - my DB can't read or write his own name despite being in his 30s.)
To those saying, bloody hope not and similar, hope you have kids with severe disabilities.

Yes. It can for a person who has disabilities, I can't remember the name but it's a special will that can be written up. You can allocate a certain amount say 6 grand a year for them and their carers to buy a holiday or purchase equipment.......some of the ignorance on this thread isn't surprising sadly. 🤔

I work in this area of law and yes it is absolutely possible.

For example, I see many clients who have children/grandchildren that they want to benefit from their estates when they have gone. Those children and grandchildren are very often severely disabled. They have care packages and are also in receipt of certain benefits which might be disrupted by an inheritance. Discretionary Trusts can be very useful in providing additional support to those relatives without it meaning that they will lose the support that they are currently in receipt of.

Most of the time clients do not wish to completely disinherit their disabled relatives just so as to avoid them losing their benefits. I would have thought this was the right thing to do in those circumstances.

For the same reason clients don't usually leave large sums of money to relatives who have issues with drugs and alcohol. It is a controlled way of making sure their loved one is taken care of, without handing over capital which would probably be used to harm themselves.

I think the ones saying bloody hope not are not talking about people with severe disabilities. They’re talking about fraud. Why would you wish that on other people?

If only it was 2 pound an hour. I'm a 24/7 carer and it currently works out at 45p an hour. It's soul destroying, especially when the current government keep setting out to make it even harder for those of us who are just looking after family members/friends/neighbours and saving them billions a year.

I don't blame the person for wanting to circle the money in a legitimate trust or similar to support them and the person they care for. The current situation surrounding disabled people and their carers is terrifying. The system we come up against (constantly proving that the seriously disabled/ill person you care for is not capable of work like the person who saw them for a 15 min assessment made out, ignoring how you had to get them washed, dressed, transport them there, wait as they gasp for air just walking from the taxi to the door with support from you and a walker/chair etc, fill them with enough meds to try manage the pain and brain fog and so on and so forth), the NHS is sadly not fit for purpose, there isn't the care, staff members needed, ops and appointments cancelled because there's no staff, meds refused that would really help because the companies that supply them charge £10 plus per pill)

If having that support in the background helps them be able to live more comfortably, look after the person who is ill when the carer passes away (horrible to think of but you said they are near pension age and carers routinely put off looking after themselves), access private care if necessary when appointments are cancelled or meds refused/stopped, supports their living situation, any repairs needed if the landlord/ha refuses or won't do it and so on and so forth I can't begrudge them.

Sounds like all the father would lose is carers allowance.

@Livelovebehappy
But they can live off and enjoy the £200k once received. If they need to use a chunk to live off, but also pay out for treats and enjoyment, they can do so. Then once the money has gone, they can go back on benefits?
Is this for real??? The 200k is there in a Trust so it can be spent on treats and other things for life. Living off this and then going on benefits for life is very different (and no treats forever more, or any possible private health or social care etc). We are talking about people who are born (or sometimes acquire) horrendous disabilities and normally lack any form of capacity.
Some of the people on this thread are simply horrid. Fraud, my arse.

So take out the interest and if you can't live off 200K, there is a problem.

People being appalled... carers have to work 35 hours a week as a carer although most are 24/7 (full time job) and they receive £69.90 per week for that that £2.28 per hour.

Don't fucking dare say thats greedy or scamming, its fucking appauling its so low and not even remotely close to minimum wage. They should be paid at MINIMUM £364.70 per week to be inline with minimum wage.

Carers should be allowed a financial safety net in the face of being paid next to nothing, they fucking need it.

So many people on this thread lack the ability to think clearly, lack empathy and are so judgmental and shallow.

OP you should obtain legal advice. Perhaps a trust as others have said.

Ignore the negative comments on here. MN is getting bad for this. It used to be a place you could come and ask for some genuine advice or support. Sadly, not the case anymore.

I don't know why people are arguing over the morality of this. It is legally possible. People are using existing laws to preserve and protect assets for their disabled relatives. The opinions of people on this thread are totally irrelevant in this case. It is legal to do this and in my view (because I have seen the difference this can make to people's lives on a day to day basis) absolutely the right thing to do in most cases.

This is not work related and not a client but I know someone who inherited £50k from her mum. The lady who had inherited had not worked for many years, because she was caring for her mum. This prevented mum going into care. Because mum only had £50k in assets, if she had gone into care, then this would have likely cost the states thousands of pounds because she would have dropped below threshold in no time at all. This saved the state a lot of money.

However, when mum died and left her £50k to her daughter then the daughter lost all of her benefits. Fair enough. She is living off the capital. She cannot work now because eighteen months after her mum died she was diagnosed with terminal cancer. She has about 12 months to live.

It is swings and roundabouts isn't it. If my friend's mum had made a different type of Will then my friend would not have lost her benefits. The Trustees of mum's Will could have made her life a little better and easier, during the time she has left to live, and thereafter the money would have been paid to charity.

Paltry as it may be, the fact remains that carers’ allowance depends on other income - there is an earnings limit, although pensions are disregarded. Someone earning £200 a week wouldn’t be eligible for careers allowance, why should someone who has just received a £200k inheritance and owns their house outright?

200K plus in 5 years' time, I presume a pro rata state pension. A house that's mortgage free and people are still claiming objectors are lacking in empathy.

I suggest the person puts the inheritance in somebody else's name and carries on claiming benefits. It's fraud, whether some like it or not.

its £200k not 200 million.

That interest is about £3k per year (even if they got in a high interest account it would only be £9k at full untouched amount) but the money would be in use and constantly deflating year by year dropping the interest... it would last maybe 7 years.