There are several reasons why you may at some stage need someone else to manage your affairs for you. You may, for instance, become too ill to manage your property or financial affairs yourself, or you may become disabled, either temporarily or on a long-term basis. Meanwhile mental health problems may prevent you from making decisions, or you may be planning to live in another country for a while.
Whatever the reason, one of the ways you can arrange for someone to manage your affairs for you is to set up a power of attorney. This means they would act legally on your behalf in dealings with organisations such as banks, the tax office, the benefits office or your local council, and in some cases make decisions for you (if you’re the person making the power of attorney you’re called a donor, but if someone else appoints you to manage their affairs you’re called an attorney).
To set up a power of attorney, you must have mental capacity – this means you must know and understand what a power of attorney is and how it will affect you. The person you appoint to act on your behalf must be aged 18 or older and capable of making decisions. You can also appoint more than one attorney to work together (known as joint attorneys). Solicitors and corporations such as banks can also act as attorneys, or you can appoint a professional attorney for a fee.
There are three different types of power of attorney:
Ordinary power of attorney
If you have a physical illness or injury, or if you live abroad, you can give someone an ordinary power of attorney to look after your financial affairs. An ordinary power of attorney cannot be used if you’ve been diagnosed with – or suspect you may develop – a mental health problem that could lead to you losing mental capacity (in this case, a lasting power of attorney may be appropriate).
Enduring power of attorney
New EPAs can’t be made today, but if you made one before October 2007 it will still be valid if you register it with the Office of the Public Guardian. EPAs were set up for people to use either before the donor lost their mental capacity or after they lost their mental capacity once the EPA had been registered. It can only be used to manage your property and financial affairs, but not your personal welfare.
Lasting power of attorney
This differs from an ordinary power of attorney because it allows someone to look after your personal welfare in addition to managing your property and financial affairs. This type of power of attorney may be the type you need if you think you may lose mental capacity at some time in the future.
There are two different types of LPA – one that gives someone the ability to manage your property and financial affairs, and another that allows them to make decisions for your personal welfare.
A property and financial affairs LPA can give someone the authority to manage affairs relating to banking, buying or selling property, benefits, tax, debts and legal matters. A personal welfare LPA on the other hand allows them to manage and make decisions about your day-to-day care, the health treatment you receive, where you live and who you can have contact with.
You can make one type of LPA or the other, or both at the same time, depending on your circumstances.
Setting up a power of attorney
To set up an ordinary power of attorney you should consult a solicitor or see an adviser at your local Citizens Advice Bureau. If you wish, you can set up an ordinary power of attorney that gives someone authority to deal with a specific matter or matters, called a limited power of attorney. If that’s the case, it’s a good idea to use a solicitor.
To make a lasting power of attorney you can use a form available online. You have to print out the forms and fill them in, then your attorney and witnesses will have to sign it when it’s finished. Once the form is ready, you must register your LPA by sending it to the Office of the Public Guardian. You can also complete your form and register it online. The registration process can take between 8 and 10 weeks if there are no mistakes in the application.
What if you haven’t set up a LPA?
If you lose mental capacity either temporarily or permanently, you can no longer make a power of attorney. Things that may cause a lack of mental capacity include dementia, stroke or other illnesses or disabilities, as well as alcohol or drug misuse.
In this case, someone who could make decisions for you would have to apply to the Court of Protection to act on your behalf. Find out more about making decisions for someone who hasn’t set up a power of attorney by visiting gov.uk
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