Lasting Powers of Attorney, also referred to as LPA’s, are a vital part of estate planning. If you lose mental capacity without these documents in place, your loved ones will have to apply to the Court of Protection to become a deputy, and only once they have this, do they have the legal authority to manage your affairs. This is a far longer, more costly process and there is no guarantee the people you want to manage your affairs will be those who end up as a deputy.
This can be avoided, by simply having your Lasting Powers of Attorney in place.
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What are Lasting Powers of Attorney?
These documents give those you trust the most the legal authority to help manage your affairs when you no longer can.
There are two types of Lasting Power of Attorney:
Property & Financial Affairs – this gives your trusted attorneys the authority to manage you’re your finances, including your home, investments, pensions as well as keeping on top of your bills.
Health & Welfare – this gives your loved ones the authority to make decisions around the care you receive as well as making decisions regarding life sustaining treatment if you wish.
Why should I have an LPA?
If you are over the age of 18, as an adult, you should really have your LPAs in place, but of course, the older you get, the more relevant they become.
LPAs are not just for those who lose capacity as they get older, after all, there are many other ways we can lose capacity. Waiting until the last minute to put these in place is a risky game, it may be too late by that point.
It is important to view these documents a bit like you would view an insurance policy, you get them done in hope you never have to use them.
If you do not have these in place, you run the risk of your loved ones:
- Not being in control
- Having to go through the Court of Protection
- Spending thousands of pounds to become a deputy
- Not having access to your finances
Did you know?
It doesn’t matter if you are married (even if you have been so for 50+ years), if you lose capacity, your spouse does not have the legal authority to make decisions on your behalf.
They can only do this if they are nominated by you in their LPA, or if they become a deputy by applying to the Court of Protection.
The most straight forward route is to have your LPAs put in place.
Speak to an expert
Similarly to your Will, Lasting Powers of Attorney can be done by you, what is also similar is that if something goes wrong, you can either be fortunate enough to find this out and rectify it (which will cost more), or your loved ones will find themselves in a position with a document that is not legally binding and it’s not fit for purpose (which will cost even more!).
There are aspects of estate planning that are not easily found, and often only learnt through years of experience. Speak to one of our experts so they can share this experience with you.
FAQ’s
Anyone over the age of 18 should have both LPAs in place. It becomes more relevant the older you get. However, once you’re 18 you are legally an adult. Without these documents in place, who will make those vital decisions on your behalf? The older you get the more important it is to have your LPAs in place. It’s also important for those of you with high risk & dangerous jobs to have them in place.
No, in fact it is possible for you to set up your own LPAs. However, many people, much like using a specialist will writing service, go down the professional route with LPAs too. LPAs are an extremely important document and should be drafted correctly, and with understanding. Having your LPAs drafted incorrectly could result in your attorney not having the authority they thought they had, and that’s assuming it gets through the registration process.
Prices vary depending on where you go to have them drawn up. As mentioned above, it is possible to do them online yourself, at which point you will be asked to pay for the registration, which is £82 per document. You do run the risk of them completing them incorrectly and not understanding them, but it is an option.
If you were to get them professionally done, you would usually have a professional go through each document ensuring you understand it and that you pick the right people to act on your behalf, as well as acting as your certificate provider & ensuring you have correctly drafted instructions & preferences. For this service, prices range from £250-£600 per document, with the registration fee on top of that.
Attorneys must be over the age of 18 and they should be someone you trust implicitly. You should consider their age (are they too young? too old?), their location, and whether they are organised and capable of ensuring your wishes are met. Attorneys for your Property and Financial LPA cannot be bankrupt. Most people tend to pick their spouse/partner, or their children (if they are over 18, and sensible of course!).
The Property & Finance LPA can be used at any time once it has been registered (if this is stipulated in the LPA itself). However, the Health & Welfare LPA can only be used when someone has lost capacity. Either way, they must only ever be used with the donor’s best interest at heart.
You have no control over who is appointed as your Deputy; this may not be who you would have wished.
There are also Court fees involved and the Deputy must take out a Security Bond to cover their actions. This is paid annually, and the amount is set by the Court. The more assets a person has, the higher the Bond. Depending on your Supervision Order the Court can also take a retainer. This amount is not disclosed until your application is agreed and is, again, dependent on the amount of assets the person has. Supervision Fees are also applied annually and vary. The Judge issues a Deputy Order setting out the extent of the powers granted to the Deputy, for example not being allowed to write cheques over £500 without the Court’s permission. Any major decisions, such as selling a property, requires the Court’s permission. The Court of Protection assesses each case and places it in a band where it will receive either a low, medium or high level of ongoing supervision. The Deputy must always report to the Court of Protection and may have to submit annual accounts for Court approval and receive periodical visits by a Court Visitor. A Deputy must account for every penny spent and any requests for money must be made to the Court in writing. The application for Deputyship is complex and the Deputy must provide personal information about themselves, their family, their own finances, and the relationship with the person they wish to care for.
The Donor – the person making the LPA. This person chooses who they would like to be their attorney/s, and sets our their wishes in the document.
The Attorney – these person/s also has to agree (by signing), and in the event the donor loses capacity, they can start making decisions on their behalf, in their best interests.
The Certificate Provider – this person signs to say the donor has the capacity to make the LPA.
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