What is a Lasting Power of Attorney, and why is it so important?

What is a Lasting Power of Attorney, what does it involve, and what happens if you don’t register for one in time? In this collaboration with our partners at Podplan, the digital platform that helps families to make informed decisions and plan ahead, we’ve answered all these questions and more. 

As you approach later life, there are several things you’ll likely start thinking about; from writing or updating your will and planning for your estate to mapping out your retirement and considering care options, should you potentially need them.

But what happens if, for whatever reason, you’re no longer able to make those decisions for yourself? or need someone you trust to help you take action? This is where a Lasting Power of Attorney – or “LPA” – comes into play.

What is a Lasting Power of Attorney?

A Lasting Power of Attorney (LPA) is a legal document that allows you to choose one or more people you trust — known as attorneys — to make certain decisions on your behalf.

An LPA can be an important part of planning ahead. If illness, an accident or a condition such as dementia means you are unable to make a particular decision for yourself in the future, the right LPA can give people you have chosen the legal authority to act on your behalf. You must have the necessary mental capacity when you make an LPA.

Before an LPA can be used, it must be registered with the Office of the Public Guardian (OPG) – the division of the Government that helps people in England and Wales to stay in control of their health and finances.

What are the two main types of LPA?

1. Property & Financial Affairs

A Property & Financial Affairs LPA gives your chosen attorney legal authority to manage your bank accounts, pay bills, collect your pension and benefits, buy or sell property, and make investment decisions on your behalf.

This type of LPA can be used with your permission while you still have capacity, or once capacity is lost.

2. Health & Welfare

This type gives your attorney authority over where you live, the medical treatment you receive, your day-to-day care, and any life-sustaining treatment decisions. Unlike the Property & Financial Affairs LPA, this only activates once you have lost capacity. It can’t be used while you’re still able to make decisions.

Each type of LPA currently costs £92 to register with the Office of the Public Guardian, or £184 if you register both types. You can create an LPA yourself using the government’s online portal, use a specialist online LPA service for additional guidance and support, or ask a solicitor to prepare it for you. Professional services will charge their own fees in addition to the registration fee.

What are the registration requirements for an LPA?

You should register for your LPA before you think you might need it, as it can’t be used until it has been registered with the OPG. Currently, registration can take up to 20 weeks, so it’s advisable to register as soon as possible to avoid significant delays.

Once you’ve registered, it’s also recommended that you let your banks and other financial institutes you have accounts with know, so that the LPA can be used quickly and smoothly when the time comes.

What happens if you don’t register for an LPA in time?

If you don’t have an LPA before you need it, you may fall into the “Court of Protection trap”, which is a formal legal process that can take six to 12 months to complete and cost £3,000-£5,000 or more – around 20 times more than an LPA.

Throughout that process, no one has the legal authority to manage your affairs, which means that bills could remain unpaid, care decisions for you stalled, and your bank accounts inaccessible.

What’s more, the court may appoint a deputy on your behalf, instead of someone like a friend or family member who knows you best and will be more able to act in your best interests.

The deputy’s role is to report to the OPG ever year on every financial decision that is made, which is much more onerous than what an LPA attorney’s obligations would be.

Court of Protection orders are also case-by-case and can’t give blanket authority the way an LPA does.

Here are some of the other common LPA questions:

Can I change my mind about the person I appoint?

Yes. As long as you still have mental capacity, you can remove an attorney or cancel your LPA at any time, even if the LPA has already been registered. If you want to appoint someone new who wasn’t named as a replacement attorney, you’ll generally need to make a new LPA.

Can I set up an LPA after a diagnosis?

Yes, but only if you still have mental capacity at the time of signing. A diagnosis alone doesn’t remove capacity, since your prognosis could be very different to someone else’s, but it’s important to act quickly.

Can my attorney make gifts?

Yes, but within strict limits. Small, customary gifts – such as for birthdays and Christmas – are allowed, but larger gifts require approval from the OPG in line with the Mental Capacity Act 2025.

For gifting as part of Inheritance Tax (IHT), under usual rules, your annual exemption allows you to give away up to £3,000 worth of gifts every tax year, without them being added to the value of your estate. Larger gifts for IHT planning may need Court of Protection approval, so it’s worth considering gifting while you still have capacity.

What if my attorneys disagree with each other on something?

You can name more than one person as an attorney and specify whether they can make decisions independently or whether they must agree. If you have multiple attorneys, there may be occasions when they disagree about a decision or what is in your best interests. What happens then depends on how your LPA is structured.

If your attorneys are appointed jointly, they must all agree on every decision. If they cannot agree, the decision cannot be made and the LPA may become unworkable. In these circumstances, legal advice may need to be sought.

See how Attivo can support you with later life planning 

Several of our Lifestyle Financial Planners at Attivo are accredited with the Society of Later Life Advisers (SOLLA) – the Gold Standard for those advising in the later life market. This means that they are empowered with the knowledge and experience to support you with your later life planning needs – both now and in the future.

If you’d like to find out more about this, you can book a free, no-obligation consultation with our team today by following the link below: