What is a Special Disability Trust?

Special Disability Trusts are a type of trust.

These trusts can allow people to set aside property and assets for family members living with disabilities without losing access to government support.

How does it work?

When a person applies for government assistance, the government checks what assets they have. If the person has a lot of assets, they might be refused disability support.

Families might want to set aside assets to help a disabled family member – either while they are alive, or in their Will. If they do so, they could cause the person’s pension to be reduced.

Special Disability Trusts can get around this problem. Instead of giving assets to the person, they can be placed into the trust. If it is done right the government will not count this property when checking if the person should receive a pension.

Who can benefit?

There are rules about who can use these trusts. Those rules will change depending on how old the person is, and whether they live in government care.

The Services Australia Special Disability Trust Team will assess a person and confirm whether they are eligible. You can find more information about this process here:

Special Disability Trust Beneficiary Assessment Process | Department of Social Services, Australian Government (dss.gov.au)

What are the benefits of a Special Disability Trust?

There are many benefits to a Special Disability Trust.

Financial Security

A Special Disability Trust ensures that resources are available to provide for the ongoing care and needs of a person with a severe disability.

Asset Test Exemption

As of 2024, $781,250.00 worth of assets may be held in a Special Disability Trust for a person without affecting their eligibility for social security benefits.

Flexibility

The funds in the trust can be used for various needs, including housing, medical expenses, and daily living costs.

Peace of Mind

Families can feel reassured knowing there is a structured plan to support their loved one.

How do I set up a Special Disability Trust?

Special Disability Trusts are created with a trust deed. They can also be created in a person’s Will so that a person’s share of the estate is placed into the trust when the Will maker dies.

The trust must meet special legal requirements, or it will not qualify as a Special Disability Trust. This means that it is especially important to make sure you have proper legal and financial advice before setting up a Special Disability Trust.