13 October 2016
Lasting Power of Attorney – Everything you need to know
Contributor: Written by Alan Jones – Director at Axis Financial Planning.
Alan Jones has 25 years experience working within the financial planning industry.
People always have questions about Lasting Power of Attorney; what it is and how to set one up. This article provides all the information you will need to know.
What is a Lasting Power of Attorney?
A Lasting Power of Attorney (LPA) is a legal document that lets an individual (the ‘donor’) appoint one or more people (known as ‘attorneys’) to help make decisions or to make decisions on their behalf.
This gives them more control over what happens to them if, for example, they have an accident or an illness and can’t make decisions at the time they need to be made.
The donor must be 18 or over and have mental capacity (the ability to make your own decisions) when setting up a LPA.
What are the different types of Lasting Power of Attorney?
There are two types of Lasting Power of Attorney that can be granted. They are 1) property and financial and 2) health and welfare. These enable you to make different types of decisions on behalf of the donor. The donor can choose to make one type or both.
Property and Financial Lasting Power of Attorney
This covers all financial aspects related to the donor, including managing bank accounts and paying bills. You will need to keep an up-to-date record of the donor’s accounts to include details of:
- Investments sold
- Assets disposed of
- Gifts made (where permitted)
You also need to ensure you:
- Claim any benefits they are entitle to
- Complete a tax return for them where necessary
Health and Welfare Lasting Power of Attorney
This allows you to make decisions on behalf of the donor regarding their health and welfare including where the donor lives and their day-to-day care, such as diet and what they wear.
An attorney, unless otherwise stated, has no legal responsibilities until the point the donor is seen to have lost mental capacity, which will be confirmed by a healthcare professional.
Should I involve the donor in every decision?
Wherever possible you should include the donor in the decision making process, although you still have the ability to act on their behalf.
Acting within the terms of the Power of Attorney
You should carefully read the Power of Attorney document and its restrictions. Restrictions can range from not selling a family portrait to making joint decisions with another attorney. Any actions/decisions made on behalf of the donor must be within the relevant Power of Attorney, even if it is what the donor would have wanted, as doing otherwise can result in an investigation by the Office of the Public Guardian.
What if I no longer want to be an attorney?
If your circumstances have changed and you are no longer best placed to be an attorney, you need to inform the Office of the Public Guardian as soon as possible to allow the donor to make an alternative arrangement.
What help or guidance is available?
If you need any further guidance on a Lasting Power of Attorney you can speak to a financial advisor, healthcare professional or the Office of the Public Guardian. To receive a complimentary guide covering Wealth Management, Retirement Planning or Inheritance Tax Planning, produced by St. James Wealth Management, contact Alan Jones, on 03456 121 230, by email [email protected], or visit www.sjpp.co.uk/axis.
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