Lasting Powers of Attorney: Protecting Your Finances, Health and Future Decisions
What is an LPA?
A Lasting Power of Attorney (LPA) is a legal document that allows you to appoint one or more trusted people, known as attorneys, to make decisions on your behalf if you are unable to do so yourself.
There are two main types of LPA: a property and financial affairs LPA, and a health and welfare LPA.
Key Differences
| Property and Financial Affairs LPA | Health and Welfare LPA |
| Covers decisions about bank accounts, savings, investments, pensions, property and other financial assets. | Covers decisions about day-to-day care, where the donor should live and medical treatment, including life-sustaining treatment if the donor has given that authority.* |
| Can be used while the donor still has mental capacity, if the donor allows this in the LPA. | Can only be used once the donor has lost mental capacity to make the relevant decision. |
| The attorney must be at least 18, have mental capacity and must not be bankrupt or subject to a debt relief order. | The attorney must be at least 18 and have mental capacity. |
*A health and welfare attorney can consent to or refuse treatment on behalf of the donor but cannot require clinicians to provide treatment that is not clinically appropriate.
All decisions made by attorneys must be made in the donor’s best interests.
Important Information
When making a health and welfare LPA, the donor must state whether their attorneys should have authority to give or refuse consent to life-sustaining treatment.
A property and financial affairs LPA will only cover business matters if this is properly authorised in the document. In some cases, it may be sensible to create a separate business LPA, allowing the donor to appoint someone specifically to make decisions about their business interests.
What Happens If You Don’t Have an LPA?
Without a property and financial affairs LPA, bank accounts may be frozen and family members may need to apply to the Court of Protection for authority to manage financial matters. This can take time and may be stressful at an already difficult point.
Without a health and welfare LPA, medical and care decisions will usually be made by professionals. Family members may be consulted, but they will not have the same legal authority as an appointed attorney.
Disclaimer: The details above are for informational purposes only. It is crucial to seek professional advice from a private client and tax specialist.
For more information, please contact info@theburnsidepartnership.com.