Will a Compensation Claim Affect My Benefits?

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Will a Compensation Claim Affect My Benefits?

If you are receiving more than £6,000 in compensation, or your savings plus your compensation payment will take your savings to more than £6,000 then it is likely claiming damages will affect your benefits. Without knowing all your particular circumstances it is hard to say for certain whether a compensation payment will affect your benefits, but there are ways you can protect your benefits and still claim compensation.

Compensation and Benefits

If you receive a lump sum compensation benefit, then you need to inform the Compensation Recovery Unit, which is part of the Department for Work and Pensions (DWP) so they can accurately assess your benefits allowance.

The current savings threshold at which means-tested benefits stop is £16,000, but all savings above £6,000 will affect the amount of benefits you can receive. Benefits which may be affected include universal credit, housing benefit, and council tax support.

Your compensation payment will not be counted towards your savings threshold for 52 weeks from the date it is paid (even if the first payment is an interim payment), but the way in which you spend it will be examined for “reasonableness” of someone who is in receipt of your type of benefit.  If you invest your payment, you need to declare any interest you earn to the DWP.

Personal Injury Trusts

You do not have to sacrifice your benefits to claim compensation or vice versa. Indeed, people in receipt of benefits are often those who are in most need of fair compensation. A possible solution which will allow you to receive money for damages without affecting your benefits payments is to set up a personal injury trust.

A personal injury trust will give you the ability to pursue the maximum compensation to which you are entitled without putting your means tested benefits at risk, or lose out if you need care provided by your local authority. A settlement payment that goes into your bank account is considered your money, but damages paid into a trust are not examined by the DWP when assessing your finances.

A personal injury trust manages your compensation separately from your personal finances. A solicitor draws up a trust and at least three trustees are appointed – one of which can be you if your trust is straightforward. The trustees have control over how your compensation is spent so choose people you can rely on to put your best interests at heart. You can set up a bare trust which gives you the ability to replace trustees as necessary.

Do I Need a Personal Injury Trust

If you receive means-tested benefits and already have at least £6,000 in savings or are being paid at least £6,000 in compensation, then you should certainly consider a personal injury trust if you do not want your benefits to reduce or cease.

You have control over how the money in your trust is spent, but it is not considered your personal money so will not affect your benefits. Money in a trust can be spent how you choose, however, take financial advice as rules regarding this have changed in recent years, and can potentially alter again.

Talk to The Compensation Experts for more information about seeking damages if you currently receive benefits.

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Am I eligible?

If you have been harmed physically in the last 3 years, due to someone else’s negligence, the short answer is yes.

Exceptions to this are for instance industrial disease or if you were a child at the time of the accident you may have a longer period to claim.

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How much could I claim?

As every injury is different, the amount of compensation paid out can differ case to case. Varying factors lead to the final figure include: extent of your injuries, earnings missed out on, future losses and more.

Our dedicated team of experts will give you an indication of how much you could potentially claim for.

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How does the process work?

We understand that when making a claim it’s important to know what to expect and when to expect it. That’s why we make the process as transparent & clear as possible.

Your solicitor will gather all the evidence and will notify the negligent party that you wish to begin claim proceedings. With your solicitor negotiating on your behalf, you will be keep up to date every step of the way.

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Why should you use us?

No Win No Fee*

We assess all claims on a No Win No Fee basis, then we can determine how successful a claim is likely to be. This service is 100% free.
We assess each claim on its merits with the information provide, which aids us determine its likely success rate.

Expert Solicitors

Our dedicated panel are experts in securing compensation no matter the injury.
Our personal injury solicitors are committed to securing the best possible outcome for you while providing expert support every step of the way.

Personal Dedicated Solicitors

Each client is provided with their own Personal Injury solicitor who will work on the case from start to finish, being there every step of the way. The client will be provided with a direct phone number and direct email address of the solicitor.

Expert no win no fee solicitors working for you

We specialise in helping victims of injury claim the compensation they deserve.

We work on a No Win No Fee basis, meaning if we don’t win your case you don’t pay! Once you make contact, our experienced team will work to recover the maximum compensation you are entitled to.

Whether you are ready to make a no win no fee claim, or you would just like a free conversation with a legal professional, we have trained advisors on hand to give you all the information you need. Take the first step to getting what you deserve by filling in our quick contact form and we will call you back whenever suits you.

  • No Win No Fee*
  • Maximum Compensation
  • Speedy Response