Types of Power of Attorney: How do they Differ?

Entrusting someone to be your Power of Attorney is a decision based on trust and assurance that the individual can make life-changing decisions on your behalf, and in your best interests, should you lose the capacity to do so.

For many, it’s a subject they haven’t discussed or even privately considered, with a long-held myth that it won’t happen to the person for a long time, if at all, so it isn’t worth considering right now. They’ll do it later.

The prevailing thought process should be to sort it while their able and let that smart decision play out when the time comes.

Did you know there are different types of Power of Attorney? Would you know which one to apply for based on your wishes and motivations behind your decision?

This article, in discussion with one of our Wills, Probate and Trusts legal experts, Simoon, aims to answer some of the questions you may have around the different types and when each might be suitable.

What is Power of Attorney?

Generally, a ‘Power of Attorney’ refers to a document used to appoint someone as your attorney, giving them legal authority to do something on your behalf. Power of Attorney is a general term and there are various types of Power of Attorney available.

Types of Power of Attorney

Depending on what you want to focus on, there are different types of Power of Attorney. These include General Power of Attorney, Lasting Power of Attorney and Enduring Power of Attorney.

They are all quite similar but with some key differences - you can double check which is the right type for you with a no obligation chat to our Wills, Probate and Trusts team.

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Ordinary or General Power of Attorney

This type of Power of Attorney can only be used by your attorney while you still have mental capacity.

It can be set up for specific purposes, such as defined financial transactions or the sale of a property in England & Wales or abroad.

However, they usually only last one year so are mainly used to deal with short term issues.

This may be useful, for example, if you are going travelling and wish for someone to be able to manage your affairs whilst you are aborad.

Lasting Power of Attorney (LPA)

There are two types of Lasting Power of Attorney; Property & Financial Affairs and Health & Welfare.

These both last long term but can be cancelled in your lifetime if you still have mental capacity to do so:

Property & Financial Affairs

• This can be used when the donor (person making the LPA) still has mental capacity and also after they lose mental capacity.
• They deal with any property and financial transaction matters. For example, going to the bank on the donor’s behalf or paying a bill for them.
• You can also leave specific instructions and wishes, for example, a minimum amount of money you would like kept in your bank account, or any regular gifts to be made.
• Otherwise, the attorney(s) of your choice must do what is in your best interest when making any financial decisions.

Health & Welfare

• This type of LPA can only be used after the donor loses mental capacity.
• It covers special wishes that the donor would like during and at the end of their life, as well as basic wishes. For example, ensuring they exercise three times a week, what medical treatments they have, or that they do not wish to be resuscitated.
• If you do not have this LPA in place and lose mental capacity, any health decisions will be made final by your doctor.

Enduring Power of Attorney (EPA)

This is similar to the above Property & Financial Affairs LPA as EPAs were replaced by property LPAs in October 2007.

It contains similar, if not the same information regarding decisions about property and financial affairs only.

You can no longer create a New EPA. If you currently have one, it is still valid and can still be used by your attorneys.

If you lose mental capacity, the EPA can still be used by your attorneys, however they will need to register it with the Office of the Public Guardian first.

Did you know…

To make a Power of Attorney you must be at least 18 years old and have mental capacity.

Being married or in a civil partnership does not automatically give you the rights to make decisions on your partners health or finances, so it is especially important to consider making one.

If you have one in place already, it is still important to check that it is up to date.

If you are thinking about making or have any other queries regarding Power of Attorney, please speak to our Wills team, who will be happy to help.

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