Enter to open, tab to navigate, enter to select
Disabled person
Practical Law UK Glossary 5-382-6982 (Approx. 5 pages)
Glossary
Disabled person
For inheritance tax (IHT), income tax and capital gains tax (CGT) purposes, a person who meets one or both of the following conditions:
- They are incapable of administering their property or managing their affairs because of mental disorder within the meaning of the Mental Health Act 1983.
- They receive certain welfare benefits (such as the personal independence payment (PIP)) or would be entitled to receive them but for specified reasons (such as being in hospital).
(Section 89(4A), Inheritance Tax Act 1984 and section 38 and Schedule 1A, Finance Act 2005 (FA 2005).)
For full details of the statutory requirements, including amendments made by the Finance Act 2013 and Finance Act 2014, see Practice note, Vulnerable beneficiary trusts: key definitions: Trusts for disabled persons.
A disabled person is a vulnerable person for income tax and CGT purposes (section 23(7), FA 2005).
Certain trusts for disabled persons or vulnerable persons benefit from favourable tax treatment. For more information, see Practice note, Taxation of vulnerable beneficiary trusts: overview.
For will clauses creating trusts for disabled persons, see Standard clauses: