Lasting Power of Attorney: A Practical Guide
What is a Lasting Power of Attorney?
A Lasting Power of Attorney is a legal document that allows one person (known as the Donor) to appoint another person (the Attorney) to make decisions on their behalf.
LPAs were introduced under the Mental Capacity Act 2005 and replaced the previous system of Enduring Powers of Attorney.
Unlike a standard Power of Attorney, an LPA continues to be valid even if the donor later loses mental capacity.
Before it can be used, an LPA must be registered with the Office of the Public Guardian (OPG).
The Two Types of Lasting Power of Attorney
There are two separate types of LPA, each dealing with different areas of decision‑making.
Property and Financial Affairs LPA – allows Attorneys to manage financial matters such as bank accounts, paying bills, investments, property transactions, pensions and tax matters.
Health and Welfare LPA – allows Attorneys to make decisions about medical treatment, care arrangements, living arrangements and day‑to‑day welfare decisions if the donor lacks capacity to make those decisions themselves.
Why Personalised LPAs Matter
Many LPAs are created using standard forms with little thought given to the practical decisions Attorneys may need to make.
Without guidance, Attorneys may struggle to determine what the donor would have wanted regarding financial decisions, property management, or care arrangements.
At Wills Tax & Trusts Ltd., we believe LPAs should be personalised to reflect the client’s circumstances and wishes so that Attorneys can act confidently and responsibly.
Guidance for Attorneys
Attorneys have significant responsibilities. They must act in the donor’s best interests, follow the principles of the Mental Capacity Act, keep accurate records and avoid conflicts of interest.
Providing written guidance alongside the LPA can help Attorneys understand how financial and personal decisions should be approached and reduce the risk of misunderstandings or disputes.
Digital Assets
Modern estate planning must also consider digital assets. These may include cryptocurrency, online bank accounts, email accounts, social media accounts, cloud storage and online businesses.
Without clear guidance, Attorneys may find it difficult to access or manage these assets if the donor loses capacity.
Certified Copies of LPAs
Attorneys frequently need to provide proof of their authority when dealing with banks, pension providers, insurance companies, investment firms and government bodies.
Most organisations require either the original LPA or a certified copy.
At Wills Tax & Trusts Ltd we normally prepare certified copies for clients so Attorneys can deal with multiple organisations without risking the original document.
Common Mistakes When Creating LPAs
Common problems include choosing inappropriate Attorneys, failing to appoint replacement Attorneys, ignoring digital assets, providing no guidance to Attorneys, or failing to prepare certified copies.
Professional advice helps ensure that LPAs are properly structured and work effectively when needed.
Conclusion
A Lasting Power of Attorney is one of the most important legal documents you can create.
It ensures that trusted individuals are able to manage your affairs if you are no longer able to do so yourself.
At Wills Tax & Trusts Ltd we believe LPAs should be personalised, practical and supported with clear guidance so that both clients and their Attorneys are protected when the document is needed.