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Limits on Lasting Powers of Attorney

If the donor of a power Lasting Power of Attorney has lost mental capacity the attorneys authority over the donors funds is governed by the provisions of the Mental Capacity Act 2005 (MCA) and the attorney must act in accordance with the MCA Codes of Practice.

In connection with gifts or other payments, information on the www.gov.uk website confirms:-

Unless the LPA states otherwise, you can spend money on:

  • gifts to a donor’s friend, family member or acquaintance on occasions when you would normally give gifts (such as birthdays or anniversaries)
  • donations to a charity that the donor wouldn’t object to, for example a charity they’ve donated to before

You must apply to the Court of Protection for any other type of gift or donation, even if the donor has given them before. These include:

  • paying someone’s school or university fees
  • letting someone live in the donor’s property without paying market rent (anything they pay below market rent counts as a gift)
  • interest-free loans

You must check that the donor can afford the gift or donation, even if they’ve spent money on these types of things before. For example, you can’t donate their money if that would mean they couldn’t afford their care costs.

Whilst a well drafted lasting Power of Attorney can include  preferences and instructions as to how an attorney can act and/or what actions they may take on your behalf, these instructions can not go beyond the limits imposed by the MCA and therefore to be able to apply funds to pay school fees would require an application to the Court of Protection.

Link to related article: www.thisismoney.co.uk/money/experts/article-7525809/Can-mother-continue-pay-childrens-school-fees-power-attorney.html?ito=1490

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