What is an LPA?
A Lasting Power of Attorney or LPA is a legal document that lets you, the donor, appoint one or more people, known as ‘attorneys’, to help you make decisions or to make decisions on your behalf when you are no longer able to do so.
This gives you more control over what happens to you if, for example, you have an accident or an illness and can’t make decisions at the time they need to be made (you ‘lack mental capacity’).
ou must be 18 or over and have mental capacity (the ability to make your own decisions) when you make your LPA.
There are 2 types of LPA:
Property and financial affairs Lasting Power of Attorney
This LPA gives an attorney the power to make decisions about your money, personal belongings and your property, for example:
This LPA can be used as soon as it is registered unless you state otherwise. It can be used if you still have mental capacity, but would like help from your attorney, as well as if you have lost mental capacity.
If you own a business, you can also put in place a separate Lasting Power of Attorney appointing someone to handle your specific business decisions on your behalf. This may be somebody different to the person you would like to handle your personal financial affairs.
Health and welfare Lasting Power of Attorney
This LPA gives an attorney the power to make decisions about things such as:
It can only be used when you have lost capacity and you’re unable to make your own decisions either temporarily or permanently.
How to make a Lasting Power of Attorney
In order to make either type of LPA you must complete the appropriate forms. They must be signed by you, your attorneys and a certificate provider, and then finally registered with the Office of the Public Guardian.
Before completing the forms there are lots of things for you to consider to make sure the document is correct for your circumstances and works for you and your family.
It is important this is considered carefully as depending on your attorney’s and the option chosen your LPA could stop working sooner than you think.
Why now?
You should not wait until you are concerned that you might be getting forgetful or are losing mental capacity as it could already be too late at that stage. Capacity can be lost instantly. An LPA can be seen as a type of insurance policy against this possibility that you might want help managing your affairs in the future.
There are two legal routes to follow where mental capacity is concerned. The most cost effective way is to put an LPA in place while you still have capacity. Not only is this the simplest way it is also the only way where you get to choose your attorney.
When capacity has been lost then it is too late to make an LPA. The only route to access finances or to deal with health and welfare issues is through the Court of Protection. This is a far more complicated, expensive and time consuming process. You will not have any control over who makes the application, the process or the Order(s) made by the Court of Protection.
The "Lasting" bit specifically refers to the fact that the LPA lasts beyond incapacity. So if you become either permanently or temporarily incapable of managing your affairs, then the LPA can be used.
This won't happen to me!
With today's increasingly ageing population dementia related illnesses are on the increase.
It's not just for the elderly! If as a result of an accident or a medical condition you suffer a brain injury then you may temporarily lose your capacity. Car accidents or Sports injuries resulting in concussion can be one way where anyone at any age can lose capacity.
Couples
Although many couples have jointly owned assets, in a lot of cases couples will still maintain separate bank accounts often for tax reasons such as to take advantage of ISAs.
If all assets are in joint names and one partner suffers from a dementia related illness then in reality their partner can still access funds to pay the bills, buy food, fix the roof etc.
However with separate funds it can sometimes lead to distressing situations where the bank will not allow you to access your partner's funds should they lose capacity. We have also been made aware of instances where banks have frozen joint accounts in certain circumstances.
Additional Notes
You can cancel your LPA at any time if you no longer need it or want to make a new one so long as your still have mental capacity,
The LPA ceases to work on death. At this point the power to deal with your affairs vests in your Executors, if you have a valid Will, or your next of kin. On your death your attorneys must return the LPA to the Office of the Public Guardian for it to be cancelled officially.
Neither LPA gives your attorney the right to access or change your Will.
How we can help
As professional experts we can explain the risks of LPAs and also how to protect yourself, so that you fully understand what the process involves.
For a fixed cost we can;
It is possible to apply for an LPA yourself through the Office of the Public Guardian, however, as you can there are lots of things to think about when completing the document and if you make a mistake then you may have to submit a further application with extra fees.
Tuesday, January 21, 2025
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