A Lasting Power of Attorney (LPA) is a document whereby certain powers are given by an individual (the “donor”) to one or more other individuals (“attorney” or “attorneys”), so that they can carry out acts in connection with property and finances on the donor’s behalf. To find out more please (0115) 924 7021 or email firstname.lastname@example.org.
There are two types of LPA: Lasting Power of Attorney, (Property and Financial Affairs) and Lasting Power of Attorney, (Health and Welfare).
We can deal with a Lasting Power of Attorney for a fixed fee of £240.00 including VAT. The cost will be £420.00 including VAT if both are required. In addition, there is a registration fee payable to the court of protection (see LPA FAQ’s).
What type of LPAs are there?
There are two types:
A) Health and Welfare LPA
This covers decisions as to where to live, daily care and medical treatment.
B) Property and Financial Affairs LPA
This is where decisions need to be taken about your finances and it is about this type of LPA that this guide is about.
What is the purpose of an LPA?
The purpose of an LPA is to provide a person or persons chosen by you who can assist in your financial affairs if you become mentally incapable of doing so.
If I become mentally incapable and I do not have an LPA, how would my affairs be dealt with?
The only way of dealing with your affairs would be to place in Court of Protection. An application would have to be made by a person (e.g a family member) to apply to become your Deputy.
Can an individual make an LPA if they are mentally incapable?
No, at that point it is too late.
What must I take into account in deciding whom to appoint as an attorney or attorneys?
There is quite a lot that you need to take into account. Probably the first and most important thing is whether you can trust the person or persons who you are appointing as your attorneys you also must consider whether they are competent to carry out the work that they may have to do. An attorney would have to be entirely honest since, if not, clearly the opportunities for fraud or theft are there.
How many people can I appoint as an attorney?
You can appoint as many as you like. However, you should not appoint too many because otherwise it can become somewhat cumbersome. Equally in our opinion, you should appoint more than one because if you only have one and that person can’t or wont act for whatever reason, the LPA may become invalid.
Can I limit the powers of the attorney?
Yes you can. There can be a number of restrictions.
Can you provide an example of restrictions on attorneys?
Yes. An attorney would be bound by restrictions and the following might be considered:
- Not to buy property on your behalf.
- Not to invest in anything other than, say, bank or building society accounts or cash ISAs.
- Not to invest in certain types of investments e.g stocks and shares.
Can I provide guidance for attorneys and how does that differ from restrictions?
Yes you can provide guidance. The difference between that and a restriction is that a guidance does not bind the attorneys but is an indication as to what they should so and hopefully they should respect that.
Can you provide examples as to the type of guidance?
The following might be considered:
- Only invest in ethical investments
- To consult certain people as to the management of your affairs but without being bound by them.
I have decided on my attorneys and on any guidance/restrictions. What else do I need to consider in relation to them?
On the assumption that you are appointing more than one, you have to consider whether you are appointing them to act on a joint basis, on a joint and several basis or joint basis as to some matters and joint and several as to other matters.
What do you mean by this?
We mean the following:
- If they are appointed to take decisions on a joint basis that mean the attorneys can only decide on matters if they are in agreement. The disadvantage of this is that they may not agree and one may be unreasonable or may not be traced. Ultimately if they can’t agree then the LPA must finish.
- The second way is a joint and several base whereby as well as acting jointly, each attorney can act individually. The advantage of that is that one person can take a decision on your behalf without meeting the full agreement of the other attorney. The disadvantage is that if that person is not honest or competent the wrong decision can be taken.
- The third way is to have a situation whereby everybody has to agree on a joint basis and perhaps this is on the most important matters and then on a joint and several bases on less important matters. You may consider this as a worthwhile compromise.
What sort of things should an attorney under an LPA carry out?
Subject to any restrictions or guidance in the LPA an attorney should generally deal with the following:
- Open close and deal with money in a bank accounts;
- Claim and receive benefits
- Buy and sell property, although this is probably going to be relatively rare
Can an LPA be made by more than two people?
No, each individual has to make their own LPA.
How old do I need to be before I can make an LPA?
You need to be at least 18. There is no other age restrictions.
I have an LPA. I wish to make a second one. Will the second one replace the first one?
It will but only if you have the mental capacity to make a second LPA. You will also need to remake the first LPA.
If I die, does the LPA remain in force?
No. An LPA automatically ends on the death of the donor of the LPA.
Can my attorney under a property and affairs LPA make decisions as to my personal welfare?
No they can’t. To do this you would need to make an LPA (Health + Welfare).
Can an attorney decide where I live?
Under an LPA (Property and Financial affairs)No. and under an LPA (Health + Welfare).
and under an LPA (Health + Welfare) Yes.
Am I required to tell anybody about the application?
How many people can I inform as to the LPA?
You can choose up to 5 people who can be told about it.
Why is there such a provision?
The reason why there is a provision for donors, i.e. people making LPAs to tell people is as a safety device in case there may be fraud or duress involved before the LPA has been made.
What is a Certificate Provider?
Each LPA requires endorsement by a certificate provider who can confirm that:
- You understand the LPA
- You have not been put under pressure and no fraud is involved in the LPA
Who can be a certificate provider?
Somebody who has known you if you are making an LPA for at least two years or somebody who has the skills and knowledge to form a judgement that you are able to make an LPA.
Can you tell me who might have the relevant professional skills?
Yes. The following could be considered:
- A registered healthcare professional (normally a doctor)
- Solicitor, barrister or advocate
- Registered Social Worker
- Independent mental capacity advocate
- Somebody else who has the relevant professional skills
Can family members act as a certificate provider?
Can cohabitees act as a certificate provider?
Does my attorney or attorneys have to sign the LPA?
Yes they do.
Can the LPA be used before it is registered?
No. The LPA does require to be registered before it can be used.
Does an LPA have to be registered?
For it to have any legal effect it must be registered with the Office of the Public Guardian.
What is the fee for registering an LPA?
The fee is £82.00 per LPA
In what circumstances would the person making an LPA be exempt from the fee of £82.00?
You are eligible for fee exemption if you receive means tested benefits and you have not received damages of more than £16,000.00, which were disregarded when obtaining eligibility for the benefit:
- Income Support
- Income based Employment and Support Allowance
- Income based Job Seeker’s Allowance
- Pension Guarantee Credit element of State Pension Credit (you will not be eligible if this is calculated as nil)
- A combination of Working Tax Credit and either Child Tax Credit, Disability Element Working Tax Credit or Severe Disability Element (within the Working Tax Credit).
This does not include Disability Living Allowance or Invalidity Benefit;
- Housing Benefit or Council Tax benefit (not the 25% single person reduction)
- Local Housing Allowance
I am not exempt from paying the £82.00, is it possible that it could be reduced?
Yes. The fee could be reduced or remitted from your income (essentially defined as your gross income) is under £12,000.00. Under that amount, you will pay 50% of the fee is £41.00. You will need to provide evidence of your annual income eg pension, both statments.