Lasting Powers of Attorney
Managing our personal affairs can become more difficult as we become older. When this happens people tend to turn to a trusted friend or relative to help them out.
By making a property and financial affairs Lasting Power of Attorney, you will give them the authority to be able to deal with financial matters for you.
This could entail taking advice about funding your care or overseeing financial dealings or perhaps make decisions concerning your welfare on your behalf.
What is a Lasting Power of Attorney?
Lasting Powers of Attorney were introduced through the Mental Capacity Act 2005 which became effective on 1st October 2007, to enable people to choose someone to manage their legal, financial and health matters. A Lasting Power of Attorney is a legal document which enables a person aged over 18 and with all their mental faculties, to choose another person or people to make decisions on their behalf. The person making the choice of person is called the 'donor' and the person taking on the task of managing the donor's affairs is called the 'attorney'. An attorney must act in the best interests of the donor and make decisions as if they were the donor themselves.
Once in place, a Lasting Power of Attorney must be registered with the Office of the Public Guardian before it can be used. The document will not give the attorney any powers until it is registered but the donor can register it at any time whilst they have mental capacity or the attorney can apply to register it at any time. The cost of registration for each document is available from the Gov.UK website https://www.gov.uk/power-of-attorney/overview or, if you live in Scotland more infomation on Power of Attorney in Scotland is available on The Office of the Public Guardian (Scotland) website.
Prior to October 2007 people used provisions under the Enduring Powers of Attorney Act 1985 to set up an Enduring Power of Attorney(EPA) to enable someone to take care of their finances if they were unable to do so, but the powers under an EPA did not extend to decisions concerning health matters. No new EPAs have been issued since October 2007, but there are still many in existence and they are still valid unless they have been replaced or revoked, but no amendments can be made to them.
If an individual named in an EPA starts to lose capacity, their attorney(s) must register the EPA with the Court of Protection. During the time the registration is being processed the attorney(s) can still use the finances for necessary items such as payment of regular bills or housekeeping expenses, but they are unable to deal with larger transaction such as the sale of property until the registration has been completed.
A permanent power of attorney has different names in different parts of the UK:
- England and Wales: lasting power of attorney
- Scotland: continuing power of attorney
- Northern Ireland: enduring power of attorney
How you get them and what they cover differs slightly, but the principles are the same wherever you are.
The big differences between the types of power of attorney are the decisions they cover – financial ones, or ones about your health and welfare. The options available depend on where you live.
England and Wales
There are two types of lasting power of attorney. You can set up one or both:
- A property and financial affairs lasting power of attorney lets someone manage all your financial affairs – for example, running your bank and savings accounts, managing your tax affairs, and buying and selling investments and property.
- A health and welfare lasting power of attorney lets someone make decisions about your health, care and welfare – for example, what medical treatment you receive and whether you move into a care home.
There are two types of lasting power of attorney:
- A continuing power of attorney lets someone manage all your financial affairs.
- A welfare power of attorney lets someone make decisions about your care and welfare.
- Combined PoA – gives continuing and welfare powers, The majority of PoAs registered are a combination of continuing and welfare powers. However, it is your choice as to the type of PoA you wish to grant.
There is only one type of power of attorney, an enduring power of attorney. It lets someone manage all your financial affairs, similar to the English property and financial affairs lasting power of attorney. There isn’t a power of attorney that lets someone make decisions about your health and well-being.
Registration and costs
It costs nothing to draw up a lasting power of attorney, unless you want a solicitor’s help – but in England, Wales and Scotland you have to register it before you can use it.
In Northern Ireland you can use it without registering it while you still have mental capacity, but you have to register it as soon as your mental capacity starts to decline.
It’s best to register as soon as possible. This is because during the registration process the document will be checked for errors.
If you catch them while you can still manage your affairs you can correct them – if not, your power of attorney might be invalid.
- England and Wales: £82 for each lasting power of attorney.
- Scotland: £75 for each power if you register them separately or you can pay £75 and register both at the same time.
- Northern Ireland: £127 for each enduring power of attorney.
The fee may change so it’s a good idea to check when you register
A Lasting Power of Attorney is an important piece of planning for the future and making one can only be done whilst a person has the mental capacity to do so. It is a vital document as, with mental capacity lost and no formal Power of Attorney in place, people are unable to make any decisions on your behalf without first applying to the Court of Protection.
Improved information to support attorneys
Research by the OPG found that many attorneys acting under either a property and finance or health and welfare LPA needed more advice on how to carry out their role effectively to protect the donor's best interests.
They have developed two new leaflets offering a quick guide to getting started as an attorney.
They tested these leaflets extensively. They've been read and commented on by a number of attorneys, external organisations, including the NHS, local authorities, businesses and charities with an interest in LPAs and OPG staff.
The leaflets will be sent to attorneys along with the OPG letter telling them that the LPA has been registered. You can also download them now from GOV.UK.