Key concerns when providing for an autistic child
Individuals with autism may have complex support needs, whether financial, social, or medical – and these may evolve over time. You may have questions such as:
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can I leave gifts directly to my autistic child or grandchild if they are unable to manage their finances?
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is it better to leave money to another family member with the hope they will care for my autistic relative?
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how will an inheritance affect their entitlement to means-tested benefits or local authority-funded care?
These are valid concerns, and there are legal mechanisms available to address them in a way that balances security, flexibility, and longevity.
How can I make provisions for my autistic child in my Will?
There are a number of legal tools that parents of autistic children can use in their Will to make strong provisions for their children in the future, after the parent or guardian’s passing. Common methods include:
Guardianship and letters of wishes
If you have a child with autism, you may appoint a guardian in your Will to assume responsibility for their care in the event of your death while they are still under the age of 18. You can also prepare a letter of wishes (ie a letter that accompanies a Will or trust document to provide insight into your wishes for how your property should be managed) to provide detailed guidance on how you would like your child to be cared for, including their personal preferences and specific support needs. A letter of wishes is not legally binding and it is not guaranteed that somebody administering a Will will follow the deceased’s letter of wishes.
Using trusts to safeguard assets and care
Creating a trust, either during your lifetime or through your Will, can ensure that your assets are used for the benefit of your autistic loved one, while protecting them from financial vulnerability or loss of benefits.
Trusts are legally binding arrangements where trustees hold and manage assets on behalf of beneficiaries. You can choose who acts as a trustee when setting up the trust, and you can provide additional guidance through a letter of wishes. Trusts are especially useful if your loved one cannot manage their own financial affairs, or if you wish to shield their inheritance from third-party risks such as bankruptcy, death and potentially divorce.
For help writing trusts into your Will, you can use Rocket Lawyer’s bespoke Will writing service.
Choosing the right type of trust
There is a variety of trusts to choose from when setting one up. Generally, different types of trusts will suit different purposes. When setting up a trust in your Will to benefit your autistic child, you may want to consider:
1. Discretionary trusts
This type of trust offers a high degree of flexibility. The trustees have complete discretion over how and when to distribute capital (ie the money or property originally put into the trust) or income (ie the money that is made by the trust through trustee management) among a group of potential beneficiaries, which may include your autistic relative.
This flexibility allows the trustees to respond to changing circumstances and avoid compromising your loved one’s eligibility for means-tested benefits. It is particularly helpful when future care needs are uncertain or likely to change.
2. Disabled person’s trusts
A disabled person’s trust (also known as a ‘vulnerable beneficiary trust’) operates similarly to a discretionary trust but is tailored for individuals who meet the statutory definition of disability under the Mental Health Act 1983. Read the government guidance on trusts for vulnerable people for more information.
The primary advantage is the preferential tax treatment it receives – benefitting from exemptions or reliefs in inheritance tax (IHT), capital gains tax (CGT), and income tax. Importantly, the trust’s assets (ie the property or money that the trust holds) are disregarded for means-tested benefits purposes, provided the trustees retain discretion over how funds are distributed. The majority of the benefit must be directed towards the disabled individual.
3. Life interest trusts
In a life interest trust, one beneficiary – often your autistic loved one – has the right to receive income generated by the trust (eg dividends from investments or rental income) while the capital remains preserved for future beneficiaries.
This type of trust may provide an income stream and/or the right to reside in a property. However, the income received will be considered when calculating entitlement to means-tested benefits. Additionally, the trust’s value would form part of the parent or guardian’s estate for inheritance tax purposes, which means it could likely be subject to paying inheritance tax upon their death.
For help with inheritance tax planning, you can use Myerson Solicitors’ inheritance tax planning service.
Professional guidance is key
The most suitable trust for your circumstances will depend on multiple factors, including the value of your estate, your family dynamics, and your loved one’s benefit entitlements. Each option carries tax implications, responsibilities for your trustees, and potential benefit for your child’s long-term care. It is therefore strongly advised to seek tailored legal advice before making any decisions.
If you need help writing a Will to provide for your children, you can use Rocket Lawyer’s bespoke Will writing service. For a Will specifically tailored to obtaining tax-efficiencies, you can use Myseron Solicitors specialist services.
