What are Lasting Powers of Attorney and why are they important?
A Lasting Power of Attorney (LPA) is a legal document allowing an individual (known as the donor) over the age of eighteen to appoint someone to manage their financial and property, or health and welfare decisions if they become incapacitated. The appointed individuals are known as attorneys. Legal Assistant in the wills and estates team, Jamie Jaskolka, discusses the different types of LPA and why they are important.
There are two types of LPAs:
- Health and welfare matters
Decisions that an attorney for health and welfare matters can make include deciding healthcare and medical treatment, the choice of who provides you with care and where you live. You can make the decision to allow your attorneys to choose whether or not they have authority when it comes to life-sustaining treatment - Property and financial affairs
Decisions can include buying or selling property, managing bank accounts, building societies and other financial accounts or even settling any debts.
You can only create an LPA while you have the capacity to understand its nature and scope. A certificate provider must confirm your ability to make an LPA. It’s crucial to discuss these matters with family and friends, especially those you choose as attorneys, so they fully understand your wishes should you lose capacity.
Benefits of having an LPA
- Control over your affairs
You choose who will manage your financial and personal matters, ensuring they are trustworthy and capable. Without an LPA a person can apply to the Court of Protection to manage your affairs, and this may not be a person of your choosing. - Guidance for attorneys
You can include preferences and instructions in your LPA, which your attorneys must follow. This ensures your wishes are considered when you no longer have the capacity to make your own decisions. - Avoiding financial limbo
Your attorneys can handle essential tasks, such as paying bills, ensuring your affairs continue smoothly. Without an LPA, if you lose capacity your assets will be frozen and no one can access them without going to the Court of Protection. - Business continuity
Your attorneys can manage business accounts and make decisions in your best interest and that of your business. - Cost and time efficiency
Without an LPA, the alternative is applying to the Court of Protection to appoint a deputy, which is a lot more time-consuming and expensive than having prepared an LPA in advance.
The importance of making an LPA in good time
Creating an LPA while you still have capacity ensures your wishes are respected and your affairs managed as you desire. Delaying this process can lead to more complicated and costly solutions through the Court of Protection, often during already stressful times.
You do not have to have lost capacity to allow your attorneys to manage your affairs, you might simply not want to do it yourself anymore.
As soon as your LPA is signed by all necessary parties, it is then sent to the Office of the Public Guardian for registration with the £82 registration fee. Your Lasting Powers of Attorney cannot be used unless registered. You have the choice for property and financial affairs LPA for it to either be in use as soon as it is registered, or only if you lose capacity. For health and welfare, it can only be used if you have lost capacity.
Key considerations
Discuss your LPA decisions with family and friends to ensure your chosen attorneys are well-informed. Plan for potential changes over time, especially if you prepare your LPA when younger. Consult us for guidance tailored to your situation. By preparing an LPA, you ensure your wishes are known and respected, providing peace of mind for you and your loved ones.
For more information and advice regarding Lasting Powers of Attorney, get in touch with a member of our wills and estates team on 033 3344 9609 or email [email protected].
Author: Jamie Jaskolka, wills and estates.
