What happens when it's too late to apply for lasting power of attorney?

Harriet Meyer / 13 April 2016

What happens if someone loses mental capacity before they have a lasting power of attorney in place? Who can manage their finances and welfare?

Nobody wants to consider what would happen if they or a family member lost capacity to make their own financial decisions. 

But if you leave it too late to put a lasting power of attorney in place, you risk a stranger being appointed rather than a chosen and trusted friend or relative.

It’s not an automatic right that a next of kin takes on dealing with your affairs. If you or a parent has just been diagnosed with Alzheimer’s, for example, it is vital to consider a lasting power of attorney (LPA).

What is a lasting power of attorney?

How does a lasting power of attorney work?

An LPA allows you to choose one or more people to handle your financial and property affairs, alongside making decisions about your health and welfare.

This is divided into two types of legal document – one for financial affairs and another for welfare.

However, this can only be done when you have mental capacity – the ability to make sound decisions. In the case of Alzheimer’s, for example, a GP will be able to conduct a mental capacity test.

How do you use a lasting power of attorney?

What happens if you don't have an LPA in place?

An LPA can be as important as making a Will, and they may become effective during your lifetime.

If there is no LPA in place, a friend or relative has to apply to the Court of Protection to become a deputy before they can deal with matters on your behalf. 

At a stressful and upsetting time this can add to difficulties, with the risk of being a long and expensive process. It can cost more than £400 for each application, with an additional £500 or more if a hearing is required.

The Court of Protection is a government body that makes decisions on financial and welfare matters for those who have lost capacity. If nobody is available, it appoints a professional from a registered list of law firms and charities – and you won’t have a say in this.

What happens if you don't make a Will?

How to set up an LPA

You can complete forms yourself at gov.uk/power-of-attorney

The fee is £110 to register each of the forms with the Office of the Public Guardian. 

Print, sign and get your chosen attorney to sign them too, making sure you follow the correct process. A solicitor or local advice agency can offer help setting up an LPA.  

For more useful information, browse our money articles.

The opinions expressed are those of the author and are not held by Saga unless specifically stated.

The material is for general information only and does not constitute investment, tax, legal, medical or other form of advice. You should not rely on this information to make (or refrain from making) any decisions. Always obtain independent, professional advice for your own particular situation.