Newspaper article The Journal (Newcastle, England)

What Happens If You Can't Manage Your Life? Wealth & Investment Management Sarah O'Hare Explains the New Power of Attorney System

Newspaper article The Journal (Newcastle, England)

What Happens If You Can't Manage Your Life? Wealth & Investment Management Sarah O'Hare Explains the New Power of Attorney System

Article excerpt

Byline: Sarah O'Hare

WHAT would happen if you had an accident, became seriously ill or simply were unable to deal with your affairs? It would make your everyday routines of paying bills, deciding on appropriate medical treatment and making financial decisions difficult and in some cases impossible.

It is therefore important to consider appointing someone (an attorney) who could look after your financial affairs and personal welfare if you became incapable.

The lasting power of attorney (LPA) is the successor to the enduring power of attorney (EPA), which was replaced on October 1, although any EPAs signed before that are still valid. Two new types of lasting power of attorney (LPAs) have been introduced: the property and affairs LPA and the personal welfare LPA.

A property and affairs LPA gives the person granting the power (the donor) the ability to authorise one or more attorneys to look after some or all of their property and financial affairs if they themselves become incapable of doing so.

The attorney may be able, among other things, to buy or sell property on the donor's behalf, run their bank account, manage their investments, deal with their tax affairs and claim benefits.

Where a valid property and affairs LPA exists an attorney can, unless it is specifically stated otherwise, act for a donor who still has the mental capacity to deal with their own affairs, but who finds it difficult for some other reason, for example because of a physical incapacity. Equally the attorney can act on behalf of a donor who has lost mental capacity.

The attorney does not always have to assume complete authority over a donor's affairs. A donor can continue to manage their day-to-day affairs with the attorney looking after more complicated matters.

It is also possible to make a second type of LPA, a personal welfare LPA, which authorises the attorney to make decisions on matters such as where the donor should live, who they should have contact with, whether they should consent to or refuse medical treatment, and their general day-to-day care.

This was not previously possible under the old system. …

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