Think of it this way.
You’re about to go away for a few weeks. So you decide to lend a spare key to a trusted friend, asking them to visit your home once in a while – to check the mail, water the plants, take out the bins, etc. – until you’re back. That’s a bit like a power of attorney (POA).
But what if the trip was indefinite?
You might then give your friend their own set of keys to keep, granting them ongoing authority to access your property whenever they see fit. That’s a bit like a lasting power of attorney (LPA).
Essentially, both are legal documents that provide a safety net for you and your family, helping you stay in control of your life – no matter what the future has in store. But the right one for you will depend on your specific circumstances and what you’re hoping to achieve.
To help you choose, here we take a closer look at each and explore how our specialist solicitors can help you take this crucial step and ensure you’re prepared for all eventualities.
Two options – ordinary or lasting
In England and Wales, there are two main types of power of attorney.
Both of which involve one person (the donor) giving another person (the attorney) the right to make decisions on their behalf. And both of which can only be set up if you still have ‘mental capacity’ and the ability to weigh up information for yourself.
1. Ordinary power of attorney
This is a time-limited agreement.
It gives the attorney authority to act on your behalf, standing in and handling matters relating to your finances, assets, property and investments – but only for a set period of time.
As such, it can be a useful option if you need someone to make decisions for you temporarily. Perhaps, for example, because you’re recovering from an injury or going on an extended overseas trip. Or maybe because you’re finding it difficult to get to the bank at the moment.
You can set a date for when the POA starts and ends and choose whether to give the attorney full or partial control of your finances – potentially restricting it to specific activities.
An ordinary POA doesn’t need to be registered with the government. But if you were to lose mental capacity in the future, the document expires and is no longer valid. This means it may not be suitable if you need someone to manage your affairs when you can no longer do so.
2. Lasting power of attorney
An LPA is the most common form of power of attorney in the UK.
As an ongoing arrangement, it has no expiry date. You can choose for it to start immediately, or it can take effect from the point at which you lose mental capacity (e.g. due to an accident or illness), and it allows the attorney to make decisions on your behalf indefinitely.
There are two subtypes of LPA:
- Property and financial affairs LPA
This gives the attorney power to make decisions about your money and property, including managing bank accounts, paying bills, collecting a pension, selling your home, etc.
- Health and welfare LPA
This gives the attorney the power to make decisions about your living situation, daily routines, medical care etc. and can only be used once you’re unable to decide for yourself.
Most people will set up both of these at the same time. And for them to be valid, they need to be registered with the government, through the Office of the Public Guardian (OPG).
Struggling to spot the difference?
POAs and LPAs are very similar, but there are a number of subtle differences between the two – which means one is usually better suited to a person’s situation than the other. These differences include:
- Timing
A POA is effective immediately (or from the date specified) and remains valid until either it expires, or you lose mental capacity as the donor – in which case authority is automatically revoked.
An LPA is also effective from the chosen start date, but lasts until you either decide to revoke authority or die. It’s still valid if you lose mental capacity.
- The scope of decisions
POAs relate specifically to decisions about your finances. They can be kept quite general (i.e. you can grant broad authority for all financial matters), or you can choose to be more specific, limiting authority to certain tasks – such as paying your electric bill, selling a car etc.
By contrast, LPAs can relate to financial decisions, health and welfare decisions – or both.
- Registration
An LPA must be registered with the government, via the OPG, which can take up to 20 weeks to complete. To be valid, a POA doesn’t legally need to be registered – although some places may ask to see a copy for their own verification purposes.
What is an enduring power of attorney (EPA)?
If you’ve done your research well, this is a term that’s likely to have popped up.
Essentially, EPAs were replaced by LPAs on 1st October 2007.
They served a very similar purpose, except, they could only be used in respect of financial decisions. And since this cut-off date, no new EPAs have been created. So if you’re only just taking the first step and looking to set up a new power of attorney, they’re not relevant.
EPAs created before 2007, however, are still legally binding. They can be used to make decisions regarding the property and financial affairs of the donor. And if the donor still has mental capacity, they can be used without being registered with the OPG.
If the donor lacks capacity, the EPA must be registered to be used.
Contact our power of attorney solicitors
POA or LPA.
Know which is the right decision for you?
Or maybe you’d like further information and tailored advice on the matter?
Either way, our specialist power of attorney solicitors can help.
Here at St Helens Law, we’re highly knowledgeable and experienced in this area of the law. Our wills and probate team can assist with everything, from identifying which option is best for your circumstances to selecting the right attorney and accurately reflecting your wishes.
The relevant application forms can all be found online – so technically, you don’t need a solicitor to appoint a power of attorney. But by guiding you skilfully through the registration process, we can help you avoid the most common stumbling blocks – preventing any unnecessary hold-ups and ensuring your chosen document is registered as quickly and seamlessly as possible.
If you’re still feeling unsure about the difference between a power of attorney, lasting power of attorney and enduring power of attorney, or have any questions, please don’t hesitate to contact us. You’re welcome to call us at any time on 01744 742360. Alternatively, send an email to info@sthelenslaw.co.uk and we’ll get back to you with further information.
You can also request a free consultation with ourpower of attorney solicitors – with no obligation to go ahead – by filling out the enquiry form at the top of this page.
