A Lasting Power of Attorney (LPA) gives someone you trust the ability to make decisions on your behalf if you cannot.
This can ensure there’s someone taking care of your affairs and advocating on your behalf if you’re ill or lose mental capacity. Naming an LPA is an important step, and it’s one you should discuss with the prospective person first.
In simple terms, an LPA is a document that gives someone the power to make decisions around health or money on your behalf.
In many cases, an LPA is used when someone loses mental capacity, but it can also be useful in other situations and may be temporary. For example, if you’re receiving treatment in a hospital, you may want someone to manage your bills so you can focus on your recovery.
Without an LPA, it can be difficult, costly, and time-consuming for loved ones to gain the power to make decisions for you. They would need to apply to the Court of Protection, which would appoint a deputy to make decisions. The deputy appointed may not be the person you’d choose, so naming an LPA now can help ensure your wishes are carried out.
Even if you’re married or in a civil partnership, you should consider an LPA – your partner does not have an automatic right to manage your affairs.
Choosing your Lasting Power of Attorney
Anyone over the age of 18 can be named an LPA, but you should think carefully about who you choose.
The right person should be someone you trust. You should also consider their age and health. For instance, while your partner may be your first choice, they may have their own health issues to manage.
As well as someone you know, you may also choose a professional LPA, such as a solicitor.
You can choose more than one person to act on your behalf. You can decide if they can make decisions independently or must make them together. Having more than one LPA can be useful, but you should consider whether they may disagree on what to do.
Whoever you choose as your LPA, having an honest conversation is important. It can help ensure you’re both on the same page and mean you feel more confident that they’d make the right decisions if they need to.
Here are four topics you should cover.
1. The responsibilities of an LPA
Becoming an LPA is a big responsibility. If you plan to name a loved one as an LPA, it’s important they understand what is involved and they’re comfortable with the role.
2. Your preferences or instructions for health and care
There are two types of LPA. When naming someone to make health and welfare decisions on your behalf, they will have the power to choose things like whether you move into a care home and the medical treatment you receive.
It can be difficult to think about needing care or serious treatment, but it’s important to discuss these issues. It can help ensure that your loved one makes decisions that are in line with your wishes. So, covering key issues like the type of care you’d prefer is important.
If you are naming an LPA, an instruction is something that they must follow, while a preference can provide guidance. You can also use restrictions if needed. Unless restrictions are included, the attorney will have the power to make all health and care decisions except:
- decisions on life-sustaining treatment (unless the LPA expressly authorises this using approved wording); and
- treatment where the donor is detained under the Mental Health Act 1983.
3. How you’d like them to manage your finances
The second type of LPA covers property and finances. Your LPA may collect your pension, pay bills, and manage your bank accounts and investments on your behalf. They may also make decisions like selling your home or giving gifts to your family in certain circumstances. Gifts proposed by an attorney for Inheritance Tax (IHT) purposes will normally have to be agreed in advance by the Court, as often attorneys do not have automatic powers to make substantial gifts.
If you have a financial and estate plan in place, sharing the details with your LPA can be useful. Again, it can help them understand your preferences and act according to your wishes.
4. Set out specific instructions
An LPA must act in your best interests, but if you have specific instructions you want your LPA to follow, be clear about what they are.
You may, for instance, specify that you’d like them to consult your financial planner before they make any investments above a certain amount.
As well as a conversation, you can use your LPA document to provide extra instructions or record your preferences. Keep in mind that a preference is not legally binding. In contract, an instruction is something that must be followed.
How to name a Lasting Power of Attorney
If you’re ready to name an LPA, you can fill in or print the necessary forms from the government’s website: gov.uk/power-of-attorney
The forms will need to be witnessed and signed by a “certificate provider”, who is there to ensure you’re acting of your own free will.
You can choose to fill in the forms yourself or seek legal advice, which could help you avoid mistakes.
You must register your LPA with the Office of Public Guardian for it to be valid. Registering each LPA will cost £82 unless you are eligible for an exemption or a remission.
If you’d like to discuss naming an LPA, including how we could work with someone you trust, please contact us.
Please note: This blog is for general information only and does not constitute advice. The information is aimed at retail clients only.
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