Power of Attorney

How to grant control of your finances

Reproduced with kind permission of the BBC’s The One Show.

Dom Littlewood met One Show viewer Heather who had to battle to control the family finances after an accident left her husband in a coma for three years.

Despite having both written wills, they had never made power of attorney in case they became mentally incapacitated – meaning The Court of Protection took control of her husband’s assets and she had to apply to access his bank accounts.

Why do you need power of attorney?

Everyone knows you should write a will to make sure your loved ones are provided for when you die, but what happens if you are left mentally unable to make decisions because of accident or illness? With an ageing population it happens more than most people think – and if you haven’t got power of attorney specifying who can look after your affairs you’ll have to go through the Court of Protection. The court was set up to protect the assets of vulnerable people.

Recent changes in the law

In 2007, as a result of the 2005 Mental Capacity Act, the new Court of Protection replaced the former office of the Supreme Court with the same name and was given an extended jurisdiction. According to The Ministry of Justice, these changes have resulted in a more personalised approach, giving most people who deal with the court greater flexibility over how money is spent, whilst still safeguarding vulnerable people. However the court is still seeing high levels of complaints and in December the President of the Court of Protection Sir Mark Potter announced he was setting up an ad hoc committee to review the Court’s rules once again.

How to grant control of your finances – lasting power of attorney

There’s an easy way to avoid the Court of Protection, and that’s to grant someone you trust lasting power of attorney, giving them the right to look after specific aspects of your financial affairs or health and welfare after you lose the capacity to do so.

You can get copies of the forms needed to complete either a Property and Affairs Lasting Power of Attorney covering money matters, or a Personal Welfare LPA covering medical matters, from the Office of the Public Guardian.

You can chose to appoint anyone you trust as long as they are over 18 and not bankrupt.

You need to fill in the forms and get it signed by all relevant parties (yourself, an independent third party called a certificate provider who verifies your capacity, and the person you’re appointing power of attorney)

In addition you should list one or more people who you want notified of the application, if you list no one an additional certificate of capacity must be provided. Registration costs £120 per form.

Certain people, including those on means tested benefits and those earning less than a certain amount per year may be entitled to fee remissions, details of which can be found on the site of the Office of the Public Guardian.

The Lasting Power of Attorney must be registered before it can be used. This means that if you want to you can save it until a time when it’s needed. However the advice is to get it registered as soon as you can firstly to avoid the long registration waiting period in emergencies, and secondly because if you’ve made mistakes and it’s declared void it will be too late.

Prior to 2007 it was possible to make Enduring Power of Attorney. This was a simpler document but didn’t include some of the important safeguards against fraud built into Lasting Power of Attorney. It is no longer possible to make an EPA but they are still valid if they were made prior to 2007.

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