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Wills & Inheritance - October 12th, 2020
When it comes to planning for the future most people know how important an up-to-date will is but don't think about having a lasting power of attorney.
If the past year has taught us anything at all, it’s that the unexpected can happen at any time, and very soon the situation can become extremely challenging.
When it comes to planning for the future most people appreciate how important it is to have an up-to-date will but, often, we don’t spare a thought about what could happen if we suddenly found ourselves unable to make important decisions and had to rely on loved ones to do it for us.
Without the proper authority, this would be impossible for them to do and this is where having a Lasting Power of Attorney (LPA) in place can be vital.
Essentially, an LPA allows any adult – known as the ‘donor’ – to give an individual or number of people – the ‘attorney/s’ – the power to deal with their property and financial affairs, or make decisions about health and welfare needs if they become unable to make these decisions themselves.
This may sound like something you only need to think about as you grow older but, as the COVID-19 pandemic has shown us, life-changing illnesses can strike at any age.
Types of LPA
There are two types of LPA: a Property and Financial Affairs LPA and Personal Welfare LPA.
The former enables your nominated attorney/s to manage your property and affairs on your behalf including paying bills, signing cheques, collecting income and benefits, buying and selling shares, and even buying and selling houses.
A Personal Welfare LPA allows the attorney/s to make decisions about your healthcare and medical treatment such as giving consent to particular types of healthcare
What happens if you don’t have an LPA?
If you were to lose the ability to make these kinds of decisions for yourself without having an LPA an application would need to be made to the Court of Protection for a deputyship order. This costs a great deal and is a very slow process. It will also limit the powers of the attorney/s.
Choosing your attorney
Great care should be taken when choosing your attorney/s as they will potentially be making life-changing decisions on your behalf.
For example, they may have to manage your money and investments as well as making decisions on how your money is spent to look after you and provide for your needs. So it must be someone, or a number of people such as your children, who you trust and who know you well. You can also choose different attorneys to deal with different parts of your affairs. So you may appoint one person to deal with private finances and another to deal with your business affairs.
Who can be an attorney?
Anyone can be an attorney, as long as they are 18 or over and are capable of making decisions. Solicitors and trust corporations such as banks can also act as an attorney.
Professional attorneys can charge for their services and if your attorney is a friend or relative, they can claim out-of-pocket expenses, but they can only get paid a salary for carrying out their duties if you have agreed to this on the LPA form.
Setting up a Power of Attorney
The best way to set up an LPA is through a solicitor like Eatons who will deal with the Office of the Public Guardian on your behalf. A fee of £130 is charged for registration of each LPA application and there will be solicitors fees to add to this too. Once completed it can take up to three months for your LPA to be registered.
But, once it is, you will have the peace of mind that everything is in place in case it is ever needed.
At Eatons, we are highly experienced in this field with a number of specialists who can also advise on all areas of LPAs, wills, probate and Inheritance Tax. To benefit from our services simply contact your nearest Eatons office or email us at firstname.lastname@example.org and we will get back to you as soon as possible to take things further.
DISCLAIMER: the contents of this article and any documents on our website are not intended to constitute legal advice but are intended for general information purposes only. We are not responsible for any loss resulting from acts or omissions taken in respect of the content presented herein. Please see our legal and regulatory information, privacy and terms policy on our website.