A Property and Financial Affairs Lasting Power of Attorney (LPA) gives a person’s appointed attorneys legal authority to step into your shoes to make decisions about, and deal with, all your legal and financial affairs on your behalf.
An LPA is used when you lose mental capacity to make choices regarding your affairs yourself, or if you still have mental capacity to manage your own affairs but wish for your attorneys to deal with them for you.
What can your attorneys do under a Property and Financial Affairs LPA?
Generally speaking, your attorneys will have complete authority to deal with all your financial affairs as you can yourself. This includes:
- Accessing all your financial information.
- Operating your bank accounts – depositing funds, withdrawing funds, moving funds around.
- Buying and selling property on your behalf.
- Insuring your property.
- Dealing with your pensions.
- Making investments on your behalf.
- Paying your bills and care fees.
- Sorting out your tax affairs.
- Applying for welfare benefits such as Attendance Allowance for you.
What can’t your attorneys do under a Property and Financial Affairs LPA?
The powers given to an attorney to make gifts on your behalf from your assets are somewhat limited. Your attorneys can only make gifts from your money or assets to people you are related to or connected with, and on occasions such as birthdays, marriage and civil partnership ceremonies, anniversaries or any other occasion where family or friends usually give presents. For example, if you always give your grandchildren £20 on their birthdays and at Christmas, your attorneys can continue to make those gifts on your behalf.
However, for larger gifts, for example giving your house to your children, these cannot be made under a Property and Financial Affairs LPA, unless the attorneys first get authority from the Court of Protection. The Court would want to see that making the gift was in your best interests before authorising it.
Attorneys can also make gifts to charities you have benefited in the past. The value of the gifts must always be reasonable in relation to your own assets.
Other important points to bear in mind:
- The LPA will only cover your property and affairs in England and Wales, not in Scotland or abroad.
- A Property and Financial Affairs LPA does not give your attorney authority to make decisions about your medical or personal care. This would be covered under a Health and Welfare LPA.
How Nelsons Can Help
Jane Sutherland is a Partner in our expert Wills, Trusts & Probate team.
For more advice or information on creating an LPA, please contact Jane or a member of the team in Derby, Leicester or Nottingham on 0800 024 1976 or via our online form.