What You Need to Know About Power of Attorney
Power of attorney is legal permission that another person can take control of your private affairs when you are no longer able to do so. Learn how it can impact your financial and personal affairs and how to register and change your power of attorney.
There may come a point in your life where you are unable, through illness or old age, to manage your own affairs, your medical care, your property or your savings.
Unfortunately, your loved ones are not granted an automatic right to access your money or make decisions on your behalf, which can create problems when trying to sort out your care or look after your finances.
Power of attorney, put in place while you still have mental capacity, gives you, the donor, the right to appoint someone else, or several people you trust, known as your attorneys, to look after your affairs when you are no longer able to do so.
Your attorneys pledge to act in your best interests and follow the instructions you give.
What is lasting power of attorney?
A lasting power of attorney (LPA) is the most common kind of power of attorney. It replaced the enduring power of attorney (EPA) in 2007, though if you have an EPA from before this point it can still be registered.
You have to register an LPA with the Office of Public Guardian to make it legally binding.
What are the different types of LPA?
There are two types of LPA, but they don’t have to be made at the same time. You could choose to register only one and you could have different attorneys for each. The two types of LPA are:
Property and financial affairs LPA
This type of LPA can be used as soon as the donor chooses, once it is registered, or when the donor loses mental capacity.
It enables attorneys to do things like open and close bank accounts on your behalf, claim benefits and pensions, pay bills or sell property.
Health and welfare LPA
This type of LPA only comes into force once the donor has lost mental capacity and gives attorneys the right to make decisions about things like moving into a care home and giving or refusing medical treatment.
When making the LPA the donor should include details of whether they want to give consent for or refuse “life-sustaining treatment”.
How to register an LPA
You do not need legal help to register an LPA though you may choose to get a solicitor or financial adviser involved if you prefer. Errors could lead to it being rejected, which would force you to go through the application process again.
You first need to choose your attorneys. They must be over 18, but could be anyone you trust. Crucially, pick someone able to stay on top of your affairs: your spouse, friends, family, or a professional like a solicitor, though the latter will be costly.
You can download forms for your LPA online at gov.uk, free. They must be signed by your attorneys, witnesses (who must be over 18 and who are not your attorneys), and a certificate provider, often a doctor, who can verify that you, the donor, have capacity to set up an LPA.
You then send the forms to the Office of the Public Guardian (OPG). You need to pay at this point, an £82 application fee for each LPA. It takes about 8 to 10 weeks for your LPA to be registered if there are no mistakes or objections.
How to change an LPA
Once an LPA is in use, it will continue until you die. In the case of a property and financial affairs LPA, however, if you still have mental capacity and wish to cancel the LPA you can contact the OPG at any time to ask for your LPA to end, or to change or remove an attorney.
You’ll need your original power of attorney documents, and a written “deed of revocation”, signed by you and a witness.
What is an ordinary power of attorney?
LPAs, as the name suggests, are designed to stay in place until your death. However, if you want someone to manage your affairs for only a short time, perhaps during a period when you are overseas or during a short illness when you will be temporarily incapacitated you can set up an ordinary power of attorney instead.
This does not need to be registered with the OPG and will last only until you revoke it, or lose mental capacity.
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Laura is a journalist and author, writing about money since 2008. Including writing for The Times for 9 years. She believes finance doesn't need to be complicated. Author of Money: a user's guide. Read more