Who can enter an LPA?
Anyone over the age of 18 who has the mental ability to make medical, property and financial decisions for themselves can arrange for someone else to make these decisions in the future.
The person assigning someone to make decisions for them in the future becomes the ‘donor’. And the person who is being granted this power is known as the ‘attorney’.
It’s worth noting that the Property and Financial Affairs LPA can only be used if you are in a position where you can no longer make these decisions.
So, what do Property and Financial Affairs LPA’s cover?
Managing Bank Accounts
The attorney can access and manage the donor’s bank account(s), they are responsible for the donor’s financial wellbeing. This can include making deposits, withdrawals, transferring funds where necessary to pay bills and manage expenses.
Paying Bills and Expenses
The attorney ensures that the donor’s financial responsibilities are met. This includes paying the donor’s bills – this could include utilities, rent or mortgage and any other financial obligations.
The attorney can make investment decisions on behalf of the donor – examples could include buying or selling stocks, bonds, housing or other investments with the goal of preserving or growing the donor’s assets.
The LPA may grant the attorney the authority to manage and make decisions related to the donor’s property – such as buying, selling or renting the property. This coverage in an agreed LPA is particularly important if the donor owns multiple properties.
Managing Debts and Loans
The donor can grant permission for the attorney to manage their debts and loans – this can include negotiating with creditors and make decisions regarding the repayment of outstanding debts.
Collecting Benefits and Income
The attorney can collect and manage the donor’s benefits, pensions, and other sources of income. By doing so, this ensures that the donor continues to receive the financial support they are entitled to.
This can include the attorney being responsible for filing the donor’s tax returns, ensuring taxes are paid on time and handling other tax-related matters.
Legal and Financial Decisions
The attorney can make legal and financial decisions on behalf of the donor, such as entering into contracts, managing business affairs, or pursuing legal actions when necessary.
Gifts and Donations
The LPA may specify whether the attorney has the authority to make gifts or charitable donations on behalf of the donor. This is often subject to legal limitations and should be carefully considered.
The attorney should maintain detailed records of all financial transactions and decisions made on behalf of the donor. This ensures transparency and accountability.
Would you like help setting up an LPA?
Our team at Burtons can help ensure that your Lasting Power of Attorney wishes are honoured and set up correctly. You can fill out our online contact form here and a team member will be in touch shortly.