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Power of Attorney
Plan in case you lose mental capacity
Updated 2 October 2023
One person in the UK develops dementia every three minutes. Yet relatives can't just walk into a bank and access your money, even if it is to pay for your care. Unless you've a Power of Attorney, loved ones would need to apply through court, which can be long and costly. So get it sorted – this guide shows you how.
While every effort's been made to ensure this article's accuracy, it doesn't constitute legal advice tailored to your individual circumstances. If you act on it, you acknowledge that you do so at your own risk. We can't assume responsibility and don't accept liability for any damage or loss which may arise as a result of your reliance upon it. This guide has been written with the kind help of the Alzheimer's Society and Age UK.
What is Lasting Power of Attorney?
Thinking and talking about what would happen if our faculties deserted us is uncomfortable. Yet it's important to consider how much worse the situation would be if you had a stroke, serious accident or dementia (for example, Alzheimer's) without sorting it first.
If someone has difficulties that mean they can't make decisions anymore, they will need help managing their finances. A Lasting Power of Attorney (LPA) is a legal document where someone – while they still have mental capacity – nominates a trusted friend or relative to look after their affairs if they later lost capacity. The key point to remember...
Don't think you suddenly give up control. You can choose whether it can be used either before, or only when, you lose mental capacity.
Your representative (known as the 'attorney') should only ever make a choice for you if you're unable to make that specific decision at the time it needs to be made. For example, if you fall into a coma, your attorney would start looking after your affairs. But if you wake from the coma, you should be able to make your own decisions again.
It's worth noting LPAs replaced the previous Enduring Power of Attorney (EPA) system. EPAs set up before 1 October 2007 will still be valid, whether or not they have been registered, though they must be registered when the person loses capacity. For more, see the Government's EPA info.
Why set up a Lasting Power of Attorney?
If you lose mental capacity, unless you've already filled in the Power of Attorney forms, your loved ones will need to apply through court to become 'deputy', a long and expensive process.
Instead, you can nominate a trusted friend or relative before you lose capacity, by setting up a Lasting Power of Attorney (LPA). You can appoint one or more representatives to act for you, and can determine how they work together to make decisions on your behalf.
You may be thinking "this doesn't affect us, we're perfectly well". This is a common misunderstanding. The key thing to remember is...
You can only set up a Lasting Power of Attorney when you have mental capacity. Once you've lost capacity, it's too late.
The key is to act early. This story from Forumite Norma Desmond explains why:
My mum is deputy (via the Court of Protection) to my dad, who has advanced dementia. It's a very long, drawn out and quite intrusive process.
It's also expensive. Mum will have to pay hefty yearly fees too. I just wish we'd managed to get Power of Attorney instead, when Dad was more capable. He got ill very fast and we couldn't implement it.
How much does a Power of Attorney cost?
There's a compulsory cost of £82 to register a Power of Attorney (in England and Wales – it's £85 in Scotland, £151 in Northern Ireland). If you earn less than £12,000/year though, you can provide evidence to pay a reduced fee of £41. Those on certain benefits (this link downloads a PDF list of the qualifying benefits) are exempt from fees.
It's £82 for the property and finance LPA.
Above and beyond that, if you decide to use a solicitor you'll also have to pay legal fees, though it's possible to set up a Power of Attorney on your own. See how to make a Power of Attorney.
What to do next
The action to take depends on the situation. We use the word 'they' below for simplicity, but, of course, you can set up a Power of Attorney for yourself as well.
- If they still have capacity. This is the best time to act. If the person still has capacity and would like to make arrangements in case they lose mental capacity, they can set up an LPA.
Once the LPA is submitted, the Government says it can take up to 20 weeks to register. The power will take effect as soon as the LPA is registered, so the attorney will be able to start making decisions straightaway, unless they specify otherwise on the application. See more on this in how to make a Power of Attorney.
- If they've lost capacity. If a spouse, relative or friend already has limited mental capacity, but didn't set up Power of Attorney in advance, it gets more difficult. You need to become a deputy of the Court of Protection to make decisions on their behalf. See how to become a deputy.
- If they still have capacity but need help managing money. In some cases, a friend or relative may still be able to make decisions, but may need help with the practicalities. For example, some people struggle to make phone calls or get to the bank. There are a few options that can help – see helping someone manage their money.
The Health and Welfare Lasting Power of Attorney
Mention a Lasting Power of Attorney (LPA) and many will automatically think of a person's finances, but in England and Wales there are actually two types to consider: one for property and finance, and another for health and welfare. Because we're MoneySavingExpert.com, this guide concentrates on the finance and property one, although the processes are similar for both.
In a nutshell, the health and welfare document sees a nominated individual make decisions over day-to-day healthcare and medical treatments, as well as deal with any health and social care staff.
It's also worth noting these are two separate legal procedures that are independent of one another.
Just because you give the trusted person Power of Attorney over your health, that doesn't mean they will automatically gain control over your financial affairs and vice versa. If you require the same individual to have Power of Attorney over both aspects of your care, then you will have to fill in the two forms separately.
Another key difference is that the health and welfare LPA can only be used after the person loses capacity, not before. For more help on setting up a health and welfare LPA, see the Government's health and welfare LPA info. For those who want to decide any 'advance decisions' – for example, you don't want certain types of medical treatment in certain situations, if you lose capacity in future – you can make a living will.
In Scotland or Northern Ireland?
In Scotland, there are three Powers of Attorney: one for financial matters, called a continuing Power of Attorney; one for personal welfare, a welfare Power of Attorney; and a combined Power of Attorney that covers both continuing and welfare, which is the most common. For full details, see the Office of the Public Guardian (Scotland) and Alzheimer Scotland's Money and Legal Matters guides.
For Northern Ireland see NIdirect's Power of Attorney info.
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Watch Martin's video briefing on Power of Attorney
Here's Martin's 'Power of Attorney: crucial financial protection' video briefing on why it’s so important, how to get one and more. Click the dropdown below to read a transcript.
ITV's The Martin Lewis Money Show Live – Tuesday 14 March 2023
Embedded YouTube Video
How to make a Power of Attorney
It's vital the person making the Lasting Power of Attorney (LPA) understands what the forms mean. Of course, there's a trust issue here. While we don't want you to be overly cautious, sadly, in some cases, family or friends may be after someone's money. Ensure they (or you) feel comfortable with the choice and consider involving the whole family.
The first decision is whether or not to use a solicitor. If you're fairly legally and financially literate, the DIY route will save you about £500 in legal fees.
The Government has made the process easier than it used to be, and there's a chance your local Citizens Advice centre may be able to help.
However, the LPA is a powerful legal document. You may wish to get a solicitor to help if you're unsure about the process, the family does not get on or there are complex assets, such as businesses or overseas property.
If so, use the Law Society's Find a Solicitor tool or, if appropriate, try Solicitors for the Elderly, a network of more than 1,600 solicitors specialising in issues affecting older people.
£74 Which? Power of Attorney code
A halfway house between the DIY route and paying £100s for a solicitor is Which? Wills*, where you fill in a questionnaire, the Lasting Power of Attorney (LPA) is populated for you, and then crucially it's checked by a qualified paralegal.
The standard cost for the financial LPA is £99, but we've blagged the following deals. The offer is ongoing. To get the discount, follow the link and choose your area (it automatically adds the code).
- England and Wales. A property and finance or health and welfare LPA costs £74 each (usually £99 each). Alternatively, you can get both LPAs for £148 (usually £198).
- Scotland. Which? only charges one fee of £74 (usually £99) for the combined continuing & welfare Power of Attorney.
- Northern Ireland. You pay only one fee of £74 (usually £99) for an Enduring Power of Attorney.
You will still need to pay any application fees separately, for example, £82 to the Office of the Public Guardian for a Financial LPA in England and Wales. (If you want the health and welfare one too, you need to pay another £82.)
How it works
Once you've purchased the service, you fill in an online questionnaire which automatically populates the government application forms. You complete it in your own time – call 0117 456 6023 if you need support.
Which? specialists will also check and review your application within two weeks. Once it's approved, you follow Which?'s guidelines to sign and send off the forms.
Step 2: Doing it yourself? Make your application via the online form
If you've chosen the DIY route to make your Power of Attorney, follow the steps to apply online if you're in England or Wales. You'll still need to print out the forms and sign them after you fill them in online. Alternatively, you can download the forms and fill them in.
The person making the Power of Attorney and their chosen representative/s must sign the forms. If you get stuck filling them out, call the Office of the Public Guardian on 0300 456 0300.
The Power of Attorney can be used as soon as it's registered, unless you specify that the representative is restricted to making decisions only after the person loses capacity.
Finally, a 'certificate provider' signs the form to verify the person understands what the Power of Attorney means.
Who can do this
In England and Wales, a certificate provider can be someone the person making the LPA has known for two years. Or it can be someone who has a professional skill or knowledge about their situation, such as a doctor, social worker or solicitor. Family members cannot be certificate providers. This definition includes:
- Spouse, partner or civil partners (or people living together as such)
- Children, grandchildren (including step-children)
- Parents, grandparents (including step-parents)
- Brothers, sisters (including half-brothers and half-sisters)
- Aunts, uncles
- Nieces, nephews
- Someone related by marriage (such as a son-in-law or daughter-in-law)
A full list of who can and cannot be a certificate provider can be found on Gov.uk.
In Scotland or Northern Ireland?
In Scotland, you can download the forms from the Office of the Public Guardian (Scotland). For help, call 01324 678 398.
In Scotland only a solicitor who is registered to practise law in Scotland or a doctor can complete a 'certificate of capacity' to ensure that you understand what you are doing.
In Northern Ireland, you can download the forms from the Department of Justice. And here you don't need a certificate provider at all. There's more on how the process works in NIdirect's Power of Attorney info.
Double-check names and dates of birth are correct – small mistakes like this mean many applications are rejected.
There's further advice on how to fill in the forms on Gov.uk. Again, before signing, it is worth thinking about what Power of Attorney means; there's good further help and guidance at Age UK, the Alzheimer's Society and Mind.
Step 3: Register the Power of Attorney
The next step is posting the application to the Office of the Public Guardian (OPG) to register it. Full steps to registering can be found on Gov.uk.
You can register the LPA either before or after someone loses capacity (provided they signed the forms while well). Registering early allows time to correct errors and means it's ready to use if urgently needed.
Once the Power of Attorney's registered, the nominated representative will be able to make choices for the person (known as the 'donor'). The representative can only make decisions the donor's unable to make at the time that particular decision needs to be made.
The application costs £82 to register (in England and Wales – £85 in Scotland, £151 in Northern Ireland), though if you earn less than £12,000/year, you can provide evidence to have a reduced fee of £41. It's £82 for each of the finance and health LPAs, so if you get both, that's £164. Those on certain benefits are exempt from fees.
The OPG also has discretion to waive fees in cases of financial hardship. If the fees would cause you real hardship, call its helpline on 0300 456 0300 to ask for the forms.
Quick questions
If they've already lost capacity...
If someone's unable to look after their affairs but did not set up Power of Attorney in advance, carers need to apply to the Court of Protection. The court will appoint a deputy to make choices about the person's finances, usually a family member or close friend.
There are two types of deputy: a deputy for property and financial affairs, and a deputy for personal welfare. The court decides whether a person who may have lost capacity is able to make decisions for themselves and if the friend/relative is the appropriate deputy.
The Scottish system works slightly differently. You need to apply for 'guardianship' at the local Sheriff Court – full details at the Office of the Public Guardian (Scotland).
How to find a solicitor
It costs £371 to register as a deputy and legal fees can be £1,000 or more (if you choose to use a solicitor). If the court decides the case needs a hearing, you'll need to pay £494 on top of that.
Deputies also have to pay an initial charge of £100 and ongoing supervision fees, which depend on the supervision level. These fees are £320 a year, unless you require minimal supervision, then it's £35. Read the Government's full guide to the deputy system.
Those on low incomes or on certain benefits can get the fees reduced or waived. See the Government's full list of fees.
It can be a long and costly process. Consider using a solicitor with specialist expertise. Try the Law Society's Find a Solicitor tool or, if appropriate, try Solicitors for the Elderly, a network of more than 1,600 solicitors specialising in issues affecting older people. Ask if it's a fixed fee.
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How to help someone manage their money
In some cases a friend or relative may still be able to make decisions, but need day-to-day help with filling in forms or calling banks.
There are a few options that can help:
Did you register a Power of Attorney between 2013 and 2017? You may be owed a refund
If you paid to register a Power of Attorney in England or Wales between 1 April 2013 and 31 March 2017, you're owed a refund of up to £54. (While the deadline to apply online has passed, it's still possible to apply by email, phone or post.)
Back in 2018, the Ministry of Justice announced that people who paid to register a Lasting Power of Attorney in England or Wales between 1 April 2013 and 31 March 2017 were owed money back, after fees were set too high.
Refunds are owed because the full application fee for registering a Power of Attorney remained at £110 between 2013 and 2017, even though the operating costs of the Office of the Public Guardian had dropped. The full fee was reduced to £82 in April 2017.
As the fee is simply supposed to cover operating costs, the Government is now repaying the difference between what applicants paid and what they should have paid, plus interest.
More help and info
If you're struggling with any of the issues raised here, try visiting a Citizens Advice centre. If someone's suffering from dementia, MoneySavers say the Alzheimer's Society's help is invaluable. You should also talk to your GP and (if applicable) social services. Other great sources of info include Age UK and Mind.
The following guides may also be relevant:
- Make a will. While you're setting up a Lasting Power of Attorney it's a good time to ensure you've an up-to-date will. Solicitor-drafted wills can be cheap or even free to make or amend. Find info on all the options in Cheap and Free Wills.
- Do a 10-minute benefits check. Do check what benefits you're entitled to. A quick Benefits Check will show if you qualify for extra help.
- 50 MoneySaving tips for the over-50s. Whether your half-century is on the horizon or long gone, the older you are, the more your cash needs to look after you. To help, we've 50+ over-50s' MoneySaving tips guide. It covers everything from freebies and discounts to how to convert a pension into an annuity.
- Stop scams. Scam letters often target vulnerable older people, usually hoaxing people into thinking they need to send cheques to secure lottery wins or to get prize holidays. If you're worried about this, charity Think Jessica has more advice on its site.
There are loads more tips to beat junk calls and post in the Stop cold callers guide.
- Death happens - plan for it. Death causes financial tragedies as well as grief. Hopefully you live happily to 120, but there are ways to lessen the impact when it happens. Our Death happens – plan for it checklist should help, including how to make a financial checklist for family and how to arrange who'd care for children and pets.
- FCA mental capacity guidelines. The Financial Conduct Authority (FCA) has guidelines on how banks must deal with people who have mental capacity problems when they apply for credit. While the guidance is aimed at lenders rather than consumers, it may help you negotiate with banks.
The FCA tells lenders to explain credit agreements clearly to customers with limited mental capacity and give them enough time to weigh up information. Banks must carefully assess their ability to repay and refer them to specialist teams. See the FCA's full guidance.
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