The standard authority confined to a Deputy allows gifts to be made on behalf of the Protected Party in limited circumstances only, provided the Protected Party lacks the capacity to make the proposed gifts.
A Deputy is able to make gifts on customary occasions to those connected to the Protected Party, such as during birthdays or religious holidays, or to charities that the Protected Party might be expected to have made donations to. The gifts must be reasonable in size, affordable in accordance with the Protected Party’s financial circumstances, and in the Protected Party’s best interests. If the gift is outside of these limits, the Deputy must seek approval from the Court of Protection.
Court of Protection approval for gifts
Where a Deputy seeks the Court of Protection’s approval, the Court must make a decision in accordance with the Protected Party’s best interests. Whilst the affordability of a gift will be a factor, the Court of Protection will not solely consider affordability compared to the proposed donee’s interests in reaching a decision, making it clear that the gift must be in the Protected Party’s best interests and not the donee’s. The below list sets out some of the factors the Court of Protection will consider when assessing the best interests of the Protected Party:
- The past and present wishes expressed by the Protected Party;
- The Protected Party’s beliefs and values, so far as they would influence the Protected Party’s decision had he/she retained capacity;
- The Protected Party’s financial position, so as to assess the affordability of the gift, including the Protected Party’s estate and expenditure needs;
- The Protected Party’s moral obligations;
- The Protected Party’s life expectancy; and
- The Protected Party’s historic approach to tax savings (so far as the gift is proposed to minimise tax on behalf of the Protected Party’s estate).
The above list is not exhaustive, and the Court of Protection will consider each case on its specific circumstances, with the focus surrounding the Protected Party. With each case turning on its specific circumstances, the Court of Protection has a wide discretion and is able to determine the Protected Party’s best interests based on each case.
As well as seeking authority to make a one-off gift, the Court of Protection is able to authorise regular ongoing gifts. This is commonly seen where regular gifts are authorised from the Protected Party’s surplus income, providing that the gift remains within the Protected Party’s best interests. Gifts can also be authorised retrospectively; however, a Deputy seeking to make a gift without the Court of Protection’s authority should do so cautiously. If the Court of Protection does not approve the gift, the Deputy will be responsible for repaying the sums to the Protected Party, with the Deputy having to seek repayment from the donee.
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