No one wants to think about being ill or losing their mental capacity; it is a difficult topic for many. However, for some individuals affected by illnesses, such as dementia or a stroke, it is a necessity, as they may need help managing their assets or welfare. A Lasting Power of Attorney, previously the ‘Enduring Powers of Attorney’ until legislation changes in 2007, allows your loved ones to take care of you and your finances if you become unable to do so yourself.
The NHS states, ‘Research shows there are more than 850,000 people in the UK who have dementia.’ and ‘It is estimated that by 2025, the number will be more than 1 million.’
With these startling statistics in mind, an LPA is an important document to consider if you will no longer be able to make decisions for yourself and want to ensure that your finances and welfare are being taken care of by someone you trust. The Alzheimer’s Society state an LPA ‘Can also help you to know that you have chosen people you trust to make decisions for you when you need them to. Planning ahead can make things easier for your family and friends as well.’
A solicitor is not needed to create an LPA, and there are two different types. A Health and Welfare LPA allows your chosen person or persons to make decisions regarding your care, such as where you live and medical treatment. It can only be used if you are incapable of dealing with these matters yourself; however.
A Property and Financial LPA can be used as soon as it is registered, with your permission. It allows your chosen person or persons to handle your financial transactions relating to bills, property, benefits, and bank accounts.
You may think that you will not need an LPA as your spouse will look after you if the worst happens. This is not the case. A Lasting Power of Attorney is still required, and if one is not in place before you have lost mental capacity, your loved ones will have to apply to the Court of Protection for a deputyship. Deputyships can be a time consuming and costly process for your loved ones to endure during what can already be a difficult time. The solution to this is to take control and complete your Lasting Powers of Attorney while you are able to, giving you peace of mind.
LPA registration are currently taking 20 weeks; if something unforeseen happens or an error occurs the application may be delayed further. We have two key tips that will assist with a smooth-running LPA application registration.
You should always ensure full names are submitted when filling out the application. There should be no initials. i.e., JOHN FREDERICK BLOGGS; not JOHN F BLOGGS. If this is incorrect, your application will be rejected.
The documents for the LPA forms must be dated in a particular order, like below, from first to last:
– Donor (Yourself)
– Witness to Donor (usually the certificate provider who has known Donor for more than 2 years)
– Certificate provider
– Attorneys and replacement attorneys (which are all witnessed)
Dating of the documents must all be on the same day or in the correct order of signature as listed above.
It is important to remember that the Lasting Power of Attorney is not a Will; and will cease upon the death of the Donor.
The registration costs £82.00 per person per power, under certain circumstances you may be able eligible for a reduction or exemption if you satisfy the necessary criteria.
We can assist you with creating a Power of Attorney; our industry-leading Legacy software is continuously updated to be legally correct. It also has a unique feature that allows the Attorneys to make more informed financial decisions if they are aware of how the assets are to be disposed of in the Will when acting for the Donor. These features mean that there are no unforeseen consequences or compliance issues for you as an Advisor, ensuring the best advice for your clients at all times.