Is there a difference between setting up a Henson trust in a will versus during my lifetime in Ontario?

Yes, though the core protective principle, a trustee with absolute discretion so the beneficiary has no enforceable entitlement, is the same either way. A testamentary Henson trust is created through your will and only comes into existence once you die, as part of your estate being administered. Until then, you keep full control of the assets, and nothing needs to be funded or managed while you're alive. An inter vivos, or lifetime, Henson trust is set up and funded now, while you're still living, which means it exists and operates immediately, with its own ongoing administration and tax filing obligations from the moment it's created.

Which makes more sense depends on your goals. A lifetime trust can be useful if you want protection or asset management to start now, for example if you're gifting money to a disabled family member during your life, or want a trust already in place and functioning before you pass away. A testamentary trust is simpler to maintain while you're alive, since it only becomes active on death.

Talk to a lawyer about your specific timeline and goals to decide which structure fits your family's situation.