Lasting Power of Attorney (LPA)
Let those whom you trust help with managing your financial affairs
Failure to secure Power of Attorney for an ailing family member may force family’s to run up large legal bills.
A Lasting Power of Attorney can be secured when an individual is still able to understand what they are doing – but many leave it too late.
When a relative with dementia can no longer look after their finances an LPA gives you the legal power to take over.
What is a Lasting Power of Attorney ?
There are two types of Lasting Power of Attorney (LPA) a Property and Financial Affairs LPA and a Health & Welfare LPA. A Property and Financial Affairs LPA is a document which allows you to choose people (attorneys) to have authority to deal with all your financial affairs for you, and a Health & Welfare LPA allows you to choose people who have authority to make decisions about your health and welfare issues.
The Property and Financial Affairs LPA
The Property and Financial Affairs LPA grants your attorneys legal authority to deal with and manage your financial affairs on your behalf. This LPA can be useful if you are abroad, physically or mentally incapacitated or simply want someone to help you manage your affairs. By having proper legal authority, your attorneys will be able to deal with all your financial affairs and the necessary organisations on your behalf with no issues. If you are an attorney then if a relative with dementia can no longer look after their finances an LPA gives you the legal power to take over.
This LPA offers peace of mind that people you trust will be legally allowed to manage your financial affairs on your behalf if and when the need arises. This can include the following:
- Paying bills
- Claiming benefits, pensions and allowances
- Operating bank or building society accounts
- Giving gifts to family members or charities
- Buying or selling property
Without a Lasting Power of Attorney, your loved ones will find it very difficult to manage your financial affairs for you, effectively as they will not have legal authority to do so, this may cause any of the following problems.
- Your investments being left unmanaged
- Your property may fall into disrepair
- If you have no LPA in place your children may have to apply to the Court of Protection to manage your affairs which is far more expensive than an LPA.
Health & Welfare LPA
A Health & Welfare LPA allows your Attorneys to make decisions on your behalf about your personal welfare, including whether to give or refuse consent to medical treatment on your behalf and deciding where you live. Health and Welfare LPA’s only take effect if you have lost mental capacity. You will continue to make decisions until you lack capacity to do so
Registration of your LPA
For a Lasting Power of Attorney to be effective, it must be registered with The Office of the Public Guardian (OPG). Your attorneys can only act on your behalf once the LPA has been registered. If it is a Health and Welfare LPA, your attorneys can only act once the LPA has been registered and you have lost mental capacity.
Who should make a Lasting Power of Attorney ?
- Any senior citizen who feels that in the long or short term, they may need help with managing their financial or health affairs
- Any person who has to spend a long period working or living abroad
- A person who has suffered an accident or illness and is struggling to cope
Frequently Asked Questions.
Q. Can I not just wait and see if I lose mental capacity, and then get a Lasting Power of Attorney organised?
No if a person lacks mental capacity they cannot legally complete a Lasting Power of Attorney application. It must be done while they have full mental capacity.
Q. If I give Lasting Power of Attorney to my children what’s to stop them selling my home against my wishes ?
A. When you organise your LPA with The Will & Probate Practice we make sure these concerns are addressed for example you can stipulate restrictions when arranging your LPA such as:
“My attorneys may not sell my home unless a doctor confirms that I can no longer live independently”
“My attorneys can not make any decisions on my behalf unless I have been declared by a doctor to be lacking mental capacity”
“My attorneys may not invest my money in any investment schemes (other than standard savings accounts) without approval from an FCA (or its replacement) regulated Independent Financial Advisor”
Q. If I give Lasting Power of Attorney to my children can I continue to make decisions myself ?
A. Yes you can continue to make decisions independently, you can decide if your children can also make decisions while you are well, or if they may only make decisions if you should lose mental capacity.
Q. Can my attorneys start making decisions on my behalf as soon as the LPA is registered with the OPG ?
A. No when it’s registered the OPG send you an OPG Validated LPA document. Your attorneys then need to take it to e.g. your bank, who would then add them as co-signatories and attorneys, before they can act for you at that particular bank.
Q. Is there a type of LPA that would enable my chosen attorneys to deal with my financial affairs as well as my health affairs?
A. Unfortunately not, you need separate LPA’s for each and unfortunately both have to be registered with the OPG and both attract a registration fee (currently £110) for each LPA. Although at The Will & Probate Practice we do offer savings if e.g. you decide to have both, or if you and your husband / wife decide to have one or two LPA’s.
Q. I have 4 children can they all be my attorneys and if so how would they decide how to make decision for me?
A. Yes they can all be your attorneys, you can have up to four Attorneys. You decide whether your children must make decisions jointly, or jointly and severally. Jointly means that all your attorneys must agree, before a decision is made. Jointly and severally means either one of your attorneys may make a decision on their own.
Q. What if I choose jointly and they don’t all agree?
A. Then the decision cannot be made. Asking attorneys to act jointly is a higher risk strategy, for example if one of the attorney’s falls out with the others, or cannot act for any other reason, the whole LPA would fail. Jointly and severally means that if one of the attorneys can no longer act, or decides not to, the remaining attorneys can still act for you.
Q. I have four children, one of them I don’t fully trust to make decisions on his own, but I don’t want to leave him out as it would hurt his feelings. How can I deal with this?
A. You can choose jointly for some decisions, and jointly and severally for others, this may be a solution for you. For example, jointly and severally for any transactions under £1,000 but jointly for anything above this.
Q. I have an adult child with learning difficulties can I act as his attorney?
A. Yes assuming your child is at least eighteen and wishes to make an LPA and your child has the mental capacity to make this decision. Having mental capacity means that a person has the ability to make decisions for themselves. Mental capacity is defined in the Mental Capacity Act 2005. http://www.justice.gov.uk/protecting-the-vulnerable/mental-capacity-act
Q. Who would decide if my child has mental capacity?
A. Staff at The Will & Probate Practice have experience of assessing mental capacity for making Wills and have received extensive training concerning the requirements to draft & provide certificates for Lasting Power of Attorney. But if capacity is in doubt we may need a doctor’s opinion.
Q. I am on means tested benefits is it possible to be exempt from any fees?
A. Yes if you receive certain types of means tested benefits e.g. Income Support, Housing Benefit, Council Tax Benefit; we can apply for full exemption of the OPG registration fee (£110 for each LPA) on your behalf.
Q. I am not on benefits but my annual income is very low is it possible for me to be exempt from any fees?
A. Not fully exempt but if your gross annual income is less than £12,000 we can apply for a 50% reduction of the OPG fee on your behalf.
Q. If I have a Health and Welfare LPA when can my attorneys act on my behalf
A. The Health and Welfare LPA would only take effect when the LPA is registered and if a doctor has confirmed that you have lost mental capacity. You will continue to make decisions until you lack capacity to do so.
Q. If I have a Health and Welfare LPA what type of decisions can my attorney make on my behalf.
A. Below are examples of decisions your attorneys may make on your behalf if you have a health and welfare LPA
- consenting to or refusing medical examination and treatment;
- assessments for and provision of community care services;
- rights of access to personal information about you, including your medical records;
- where you should live and who you should live with;
- making arrangements for medical, dental or optical treatment;
- complaints about your care or treatment;
Q. If I have a Health and Welfare LPA are there any limitations as to what decisions can be made by my attorneys ?
A. There are three important limitations as to what attorneys can do under a Welfare LPA:
- The attorney must act in your best interests;
- There is no power to demand specific forms of treatment. The attorney can merely give or refuse authority or consent to someone else – such doctor or carer – to carry out or withhold a particular treatment or act;
- If you are detained under the Mental Health Act 1983, no decision can be made regarding treatment for a mental condition.
Q. I have an Enduring Power of Attorney, do I have to cancel that and get a Lasting Power of Attorney?
A. No not at all. Lasting Power of Attorneys replaced Enduring Power of Attorneys, so no new ones can be made, but existing ones are still valid.
Q. I Have an Enduring Power of Attorney. Does it cover health and welfare as well as finances ?
A. No it does not. The Health and Welfare LPA was a new innovation, no other document gave another person power to make decisions about personal & medical issues.