Setting up Power of Attorney
If you’re worried about your ability to manage your affairs in the future, you may want to consider setting up a Power of Attorney. This involves handing over decisions about finance, property or care to someone you trust. This could be a temporary arrangement, for example while you’re in hospital, or for longer.
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There are three different types of Power of Attorney that can be used to manage your financial affairs and welfare.
1. An ordinary Power of Attorney (called a general Power of Attorney in Scotland and Northern Ireland)
This lets you transfer control of your affairs temporarily. It can cover all your financial affairs or just some aspects of them. You must have ‘mental capacity’ (the ability to make this decision) to set one up. The power automatically stops if you lose capacity. At this point, if decisions need to be made, a family member or close friend can apply to be your deputy at the Office of the Public Guardian, sometimes called the Court of Protection. If no-one is willing or able to act on your behalf as your deputy, the Court will appoint someone from a trusted panel of professionals.
How to set up an ordinary Power of Attorney
The wording should be precise, so it’s best to ask a solicitor or other legal expert – for example, at a Citizens Advice Bureau – to draw up the document for you. The cost of a solicitor can vary, so it's worth contacting a few to compare prices.
You can give your attorney the power to take all financial decisions for you or you can limit their power to specific areas – for example, operating just your current and savings accounts.
Each institution your attorney deals with will need to see either the original Power of Attorney or a copy that’s been signed by a solicitor, so you may want to get several signed copies when it’s drawn up.
An ordinary Power of Attorney starts on the date specified in the document. It doesn’t have to be registered anywhere.
You can specify in the document the date that the Power of Attorney will end. Alternatively, it can be open-ended. In that case, you’ll need to complete a ‘deed of revocation’ to cancel it. Again, a legal expert can help you do this.
An ordinary Power of Attorney will automatically end if you lose mental capacity.
2. Lasting Power of Attorney for property and financial affairs (called a continuing Power of Attorney in Scotland and lasting Power of Attorney in Northern Ireland)
This is used to plan ahead and allows someone to take certain decisions for you if you become unable to. You must have mental capacity when you create the power. You must register the Power of Attorney before the person acting for you (your attorney) can use it.
A lasting Power of Attorney allows you to give another person the right to make decisions about your affairs, your property and/or your welfare. Decisions about your care and treatment can be covered by a lasting Power of Attorney for health and welfare.
3. Lasting Power of Attorney for health and welfare (called a welfare Power of Attorney in Scotland)
In England, Wales and Scotland (but not Northern Ireland), there is a second type of lasting Power of Attorney. This gives someone else the right to take decisions about your healthcare and other aspects of your welfare, if you do not have the capacity to make these decisions yourself. It also allows them to access your health records.
You can choose to set up just a property and financial affairs Power of Attorney, a health and welfare Power of Attorney, or both.
In Scotland, you can appoint a continuing welfare Power of Attorney to someone who would have responsibility for your welfare decisions. These Powers of Attorney can only be used once you have lost capacity to make these decisions yourself. If you lose mental capacity and there’s no Power of Attorney, a family member or friend will need to apply to be a deputy at the Court of Protection.
There is no equivalent to a welfare Power of Attorney in Northern Ireland. However this is currently being revised as part of the Mental Capacity Bill. This means that the lasting Power of Attorney in Northern Ireland (changed from enduring Power of Attorney) will soon cover health and welfare as well as financial matters. You can find out more about this from the Northern Ireland Office of Care and Protection .
The Office of the Public Guardian (see below) holds the register of all Powers of Attorney and can be used to confirm who’s allowed to act on your behalf.
How to set up a lasting Power of Attorney
The government publishes the forms and guidance you need to set up a lasting Power of Attorney or its equivalent in Scotland and Northern Ireland.
Letting someone else control your financial and legal affairs is an important decision, so you may want to get advice from a solicitor.
Apart from any solicitors’ fees, there’s no charge for drawing up a lasting Power of Attorney. But it can’t be used until it’s registered. The registration fee applies separately to each financial Power of Attorney and welfare Power of Attorney.
The fees are currently (as of September 2014):
- England and Wales: £110
- Scotland: £70
- Northern Ireland: £115
It can take up to 10 weeks to register your Power of Attorney. As soon as the Power of Attorney is registered, your attorney can act for you – even if you’re still able to manage your own affairs. If you don’t want them to step in immediately, you need to make this clear on the form.
You can cancel or change a lasting Power of Attorney at any time while you have mental capacity. You might also want to consider keeping a copy at home with your advance care plan and any other important documents.
Another way of controlling or influencing future decisions if you lose mental capacity is an advance care plan.
An advance care plan can refer to two different types of arrangement:
- An Advance Decision expressing your wish to have medical treatment withheld. Doctors must by law respect this decision. This is sometimes referred to as a ‘Living Will’.
- An advance statement expressing your wishes about other aspects of your care. It should be taken into account but isn’t legally binding.
If you want to make an advance statement, let the people caring for you know about your wishes. You could include information in the restrictions and conditions sections of a health and welfare Lasting Power of Attorney. This means that your attorney must take these wishes into account. You can also give your attorneys authority to give or refuse consent to life sustaining treatment.
Read more about advance care planning.
You can make it easier to manage your own affairs by having earnings and benefits paid automatically to your bank account. Set up direct debits and standing orders to pay regular bills, and use internet, mobile or phone banking to manage your money from home.
If you still need help, there are some alternative steps you could consider.
- Ask your bank if it will set up a ‘third party mandate’ to let a person you name operate your account for you. A simpler solution is to have a Power of Attorney held on the bank’s file.
- Transfer some money to a joint bank account with the person who will be helping you so that they can pay bills from that account.
- If you’re getting your benefits paid into a Post Office® Card Account, apply to have the person helping you appointed as your ‘permanent agent’. You can use a form available from post offices. Your permanent agent will be given their own card and PIN (personal identification number) so they can collect your benefits for you.
Don’t just give someone else your own cash card or debit card and PIN. You’ll be breaking the terms and conditions of the account and putting the person helping you in a difficult position if any money goes missing.
The advantage of a Power of Attorney is that it allows you to get help with all of your money affairs rather than just a single account.
Choose someone you trust completely and who understands you well. They’ll have a duty to always act in your best interests.
Most people choose a family member – their husband, wife, partner, son or daughter (as long as they’re 18 or older). Check that they‘re happy to take on this role. You’ll also need to tell any other interested parties of what you’re doing. Interested parties are family or friends who might be affected by your decision.
You can also appoint a firm – for example, a bank or solicitor – as your attorney, but they will charge.
You can appoint more than one attorney if you want to. If you appoint more than one attorney, you can specify whether they all must agree every action (jointly) or each act for you independently (jointly or severally).
This can help to protect your interests, but could make operating the Power of Attorney more difficult, for example if there are signatures required.
Alternatively, you can appoint them jointly and severally. This means that each attorney can make decisions alone and sign documents alone.
You can only set up a Power of Attorney or an Advance Decision if you have the required mental capacity to do so. An ordinary Power of Attorney stops if you lose mental capacity. A health and welfare Lasting Power of Attorney or Advance Decision will be used only if you lose capacity. A property and financial affairs Power of Attorney can be used prior to loss of capacity should the donor wish.
Mental capacity means your ability to make a particular decision for yourself at the time it needs to be made. You’re assumed to have this capacity unless it’s proved that you don’t.
As part of making a Lasting Power of Attorney you’ll need an independent person to certify that you have capacity.
Setting up a Power of Attorney doesn’t mean you’ll necessarily hand over control of all your affairs. Because mental capacity is decided in relation to particular decisions, even if you need help with some (for example, managing investments), you can still stay in control of others (such as paying bills and day-to-day money management).
Citizens Advice Bureau – to find your local branch
- England : 08444 111 444
- Wales : 08444 77 20 20
- Scotland : 03454 04 05 06
- Northern Ireland : 0300 1 233 233
Solicitor - to find one
- England and Wales: Law Society of England and Wales 0870 606 2555
- Scotland: Law Society of Scotland 0131 226 7411
- Northern Ireland: Law Society of Northern Ireland 028 9023 1614
Power of Attorney forms and guidance – download or order
This content is provided for general information purposes only. It's not medical, financial, legal or personal advice. We suggest that you consult with a qualified professional about your individual circumstances. How our information is created and how it's used.
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