Setting up a vulnerable person's trust for an adult child

[Thereasonwhynot]

Does anyone have experience of setting up a vulnerable persons trust for an adult child with a worsening physical disability? We have a letter of wishes linked to our will that suggests this in order to ensure there is care available. From April 27 when pensions are included in inheritance tax, we will be liable to pay the tax so we are considering setting up a trust now. But what proportion to put in bearing in mind we have 2 other children? Setting up a trust now would also help her to plan for the future.
Also would it be considered deprivation of resources if we both needed considerable care in the future?

You should speak to a financial advisor OP.

Do you have other children? Are they to receive similar? If you haven't considered this, please do.
I only ask as one set of parents to an adult child with LD did this with all their assets. Two other children received nothing. Soon after their death the LD person was deemed not to have capacity, was taken into residential accommodation paid for by this money. The state would have paid for this care if he had not had the money.
The two other adult children received nothing.

I think cerebra do an online information session on this. Might be worth looking into that?

I’d recommend speaking to a family lawyer who specialises in trusts. There’s a fair bit of admin required. They can also advise on the deprivation of assets.

I am following this thread as I have an adult DC who can’t deal with money at all.

Wow. This is appalling.

Yes OP please seek proper financial advice. It has catastrophe written all over it otherwise.

Please seek proper legal advice. Something like a discretionary trust will mean the money isn't classed as part of her assets. If it's not set up properly then it'll likely all/mostly go in care fees and prevent her accessing benefits until her assets are sub £16k.

As long as you're not going or anticipating care now then unlikely to be classed as a deprivation of assets.

I thought the whole point of a trust was that this couldn’t happen?

I am looking into this too. My eldest child is autistic and cannot manage money. I have been investigating a discretionary trust that will have 1/3 of my estate , but also 1/3 of the money I intend to pass on to my children when my mother passes away. I have found a local TEP lawyer and will be altering my Will to incorporate this. It’s complex, and likely to cost £3-8 k to set up, but I am certain it’s necessary. You need trustees too - preferably younger than you are ! I’m intending to have two family members and one professional trustee. My child is unable to sustain employment and needs supported living in they are to be independent - that’s like hens teeth, so the trust should be able to house them and manage their bills / money so that they have secure housing

Thank you all. The Cerebra website directed me to Mencap where you can sign up for a free webinar on trusts and wills which will be useful background. Our solicitor has recently retired but will ask her for a recommendation as I think it’s preferable to set up the trust now maybe just with a nominal amount rather than leave the instruction in our wills, especially given the cost. And the time.
It’s future care needs I’m most concerned about. Wages aren’t taken into account in the financial assessment but any pension will be. The 5 hours she gets at present help her live independently, with some family support.
We’ve always intended to provide equal shares, but can’t pass money to this daughter without it disrupting her care package.

Mencap have a list of approved solicitors for setting up trusts.
It’s important to get specialist advice on this area of law as it can be complex. Disabled trusts are more tax efficient than discretionary trusts.
Setting up a trust can cost around £2,000.

This law firm have free webinars and some good information on their website:
https://renaissancelegal.co.uk/