Managing people’s money
Enduring Power of Attorney (EPA)
An Enduring Power of Attorney is also known as an EPA. It is a document appointing a person, an ‘attorney’, to manage the property and financial affairs of another person, the ‘donor’.
If the donor becomes unable to make financial decisions, the EPA must be registered before it can be used. If it is already in use, it must be registered before it can continue to be used.
New EPAs can no longer be created. However if a person has an EPA made before October 2007, either registered or unregistered, it can still continue to be used.
Lasting Power of Attorneys (LPAs) have now replaced EPAs. EPAs only allowed people to appoint attorneys to make decisions about property and financial matters on their behalf. The new LPAs give more protection and options.
If someone already has an EPA and still has capacity, they can either replace it with a Property and Affairs LPA or keep the EPA. They can also make an additional LPA for personal welfare decisions. The Office of the Public Guardian can provide information about the options available. They have also created this guide to Enduring Powers of Attorney.
Lasting Power of Attorney
Lasting Power of Attorney (LPA) replaced Enduring Power of Attorney (EPA) on 1 October 2007. EPAs signed before that date are still valid and can be registered. However, the LPA is more flexible. You have the option of taking out a Property and Financial Affairs LPA, a Health and Welfare LPA, or both.
In both cases, the LPAs cannot be used by the attorneys until they have been registered with the Office of the Public Guardian.
Unlike with the EPA, the LPA requires that the person making the LPA is certified to have the mental capacity to do so. They must also be doing so without being subjected to any pressure or fraud. The certificate provider must complete a statement to say this in the new LPA. They must state that they:
- have discussed the LPA with the attorney
- are satisfied the attorney understands the scope and purpose of the LPA
- are under no undue pressure to make it
The government website has produced helpful guide on Making and Registering a LPA.
Property and Financial Affairs LPA
The Property and Financial Affairs LPA allows you to appoint an attorney to manage your property, finances and affairs. They can do this both when you have the capacity to make your own decisions and when you lack capacity. It also offers the option of giving your Attorney the power to make decisions about part, or all, of your property and financial affairs.
Health and Welfare LPA
A Health and Welfare LPA allows you to appoint an attorney to make decisions on your behalf in respect of healthcare and welfare.
Once a person has already lost the mental capacity to make the decision around a LPA, you cannot proceed with it. You may need to appoint an appointee or deputy instead.
This is an arrangement with the Department for Work and Pensions (DWP) where they appoint someone to act on another person’s behalf. This is when a person does not have the capacity to deal with their benefits. In order to apply to become an appointee, you will need to submit form BF56 to the DWP. They will generally visit the person to make sure they need an appointee. They will then issue a BF57 as confirmation that the appointee has been granted.
The responsibilities of an appointee include:
- finding out what benefits the person is entitled to
- completing and submitting claims for these benefits
- receiving the benefits and ensuring they are used for the welfare of the person they are helping, for example, to pay
- their household bills
- keeping the DWP updated of any change in the person’s personal circumstances or finances
- repaying any overpaid benefits
- providing the person with personal allowance if they are in care home
An appointee does not have any authority to deal with other financial issues on behalf of the person such as:
- accessing their bank accounts
- dealing with any debt issues
- signing any legal documentation such as a tenancy agreement
If someone is experiencing difficulties with managing their benefits, then a family member or friend could apply to become their appointee.
You can read more about becoming an appointee for someone claiming benefits on the UK Government’s website.
If the persons’ finances are more complex or access is needed to bank accounts then this arrangement will not be suitable. You may need to appoint a deputy.
A deputy is a person appointed by the Court of Protection (COP) in London. They deal with the property and financial affairs of another person who lacks the capacity to deal with it themselves.
For many people, the deputy would be a member of their family or a friend. The family could also instruct a solicitor to do this on their behalf. When a deputy is appointed by the Court of Protection, they issue a court order which sets out the powers of the deputy.
The responsibilities of a deputy could include:
- dealing with a person’s income and paying their bills
- dealing with any debt issues and trying to resolve these
- selling a person’s property
- selling a person’s car and other personal belongings such as household goods or furniture
- signing a tenancy agreement on behalf of a person
- dealing with a financial settlement following a person’s divorce
When a deputy is needed but there is no one to take on the role, you can apply for a Panel Deputy.