New power of attorney guide

Rosie1980

Thanks u4n90, I have done LPA's before for elderly relatives it's just we're short on time and I was hoping to do an OPA as it can be signed and doesn't require the OPG. Might just get on with it and do it now. It's frustrating there's so little info about OPA's out there.

monto743

Does anyone know this? please tell me. I am a carer for my elderly husband, I am 76, our home in our will passes to who-ever survives the other.

My next question is this.Do I need a POA. wWe have a joint account also

I thought I would have access to whatever was in the account

whatever happens.

Rosie1980

Monto743, everything that is in joint names you would have access to. However if your husband holds any accounts or the house in only his name you would have trouble dealing with any of these without power of attorney. Do you have anyone you could give power of attorney to if neither of you had the mental capacity to deal with your affairs?

John_Pierpoint

If the house is owned as tenants in common you would have problems selling it if husband was incapacitated but still alive.

fozzie55

Hello all you MSE's. Sorry might be rude just asking for some quick advice please but pretty worried and urgent.
I am signing up to LPA's for my Mum and Step Dad on Wednesday, they want me to look after their financial and health affairs.
I have never looked into their financial affairs but I expected them to have about £150k in savings as well as house they live in.
It is looking like their savings are being used by my younger half brother (may be in his name, my step dad's natural son), to help him build up some property empire. Using the cash to do deals and modernise shops and sell on etc. I don't think it goes back in my step dads account because he doesn't want it to be seen and used for care home fees!
I think they are panicking and I have been told they can 'wire' it over straightaway!

My question is...

In signing up to do this, do I need to know the extents of my parents financial affairs, where all the money is currently?

If it transpires later that my younger half brother has this money and my other brothers and sisters don't know about it, will I be fingered as being party to it?

Thanks you so much

Rosie1980

In answer to your first question it depends why they are doing this. Is it a precaution in case they can no longer take care of themselves in the future but for now they will continue to manage their money? If so then no you need have no info regarding their money, it will obviously help you later down the line if it's all organised. However if they feel they no longer want to manage their finances then yes you will need to know where money is as you will presumably have to use it to pay bills and their living costs. As POA you do not have the power to gift money to others, only continue reasonable gifts they have previously made ie annual birthday gifts. You are accountable for only the money you spend nothing they have done or do. If you are managing their money then you need to keep records/receipts of all spending you do on their behalf. Just drawing up and registering POA doesn't give you access to their money, you will have to register it with all the financial institutions you need to act on their behalf with. I hope that helps. I don't know the ins and outs of the situation but maybe they could make you a joint power of attorney with your siblings so that no issues of distrust can arise.

fozzie55

Thank you Rosie. As I live the closest to them, I think they want me to help them straight away after setting this up. I have a half sister in America and full Sister in Scotland. If the worse happens and they ask me where the money is and I don't have an answer? As Attorney I can't have it in my account, my Step Dad doesn't want it in his account?

Rosie1980

fozzie55 wrote: »

If the worse happens and they ask me where the money is and I don't have an answer?

By "they" I assume you mean your siblings, like I said you are not accountable for your parents financial actions, only for those you carry out with your POA.

However if you are executor of the will and the worst does happen it will be your responsibility to ensure any money gifted in the 7 years prior to death is included in the estate valuation.

fozzie55 wrote: »

As Attorney I can't have it in my account, my Step Dad doesn't want it in his account?

If your Step dad is attempting to avoid inheritance tax POA is not the way to do it, he needs to start gifting money to those he choses using as much of his allowances as possible. You can't put his money in your account as POA it is still his and by granting you POA that doesn't change who the money belongs to.

If he has a large sum of money he wants to avoid inheritance tax on or care home fees eating into it then it may be time to seek the help of a solicitor.

John_Pierpoint

Let us break this down a bit and analyse the situation.
Have you just been chosen for this role because you are the nearest or because you are a steady pair of hands, who won't take any nonsense from the rest of the family?
Are there already emotional/relationship problems within the family (Divorce, feuds, resentments ).
How many relatives have a need to know and a right to know what is happening, for example if one of the parents needs domiciliary or institutional care ?
Are you appointing someone to be the communication person with the rest of the family? (It is such a problem getting the same message at the same time to a half a dozen different people. Thank heavens for email and Skype.)

Is there a problem with the health and welfare power of attorney.
Probably not so you can sign up for that one.

Now the finance.
It seems the parents are trusting the speculating "son" with a fair amount of their/family wealth.
So why is this "expert" not the obvious financial attorney, perhaps with you as the communications person with the rest of the family ?
If your parents wanted a solicitor (or other professional) as their attorney, they could have appointed one.
How well can you work with with this step brother, or are he and his dad just looking for a compliant cypher (who might be left carrying the can)?

I think that the bank of mum and dad has realised that they are acting as bankers but with none of the security that real bankers have evolved for dealing with the situation where the desperate borrower over time develops a sense of entitlement (and resentment about the price they are paying to rent the use of someone else's money).

I would suggest that before you agree to anything on the financial front you explain that you need to know the current finances in detail and the structure of the situation anticipated by the parent's wills. Who will be their executors ?

So your decision is much more about relationships and trust, than it is about accounting and legalities. All parties know that were the situation to deteriorate to a legal, tax or accounting mess; then £150k could be small beer. [I have seen a boundary dispute consume more than that.]

Beware of the situation where you (as executor) find a loan note from the bank of mum and dad that you have to call in, so that you find yourself collecting £10,000 and promptly give back £6,000 of it to the person involved;, though from the figures you have posted so far, the zero rate allowance for a married couple of £650k for the purposes of InHeritance Tax (IHT) does not appear to have been breached yet, unless the house is large or within the M25.

fozzie55

John and Rosie, thank you for your time and help, that is immense. I'll try and answer other questions later. We have been seeing a Solicitor who is drawing up the POA, £400 + £130 (£110 now) x 4 = 2 grand! He holds the wills as well. Going tomorrow to sign everything.

Yes no question of inheritance tax with that threshold but older people still perceive the 'government are going to take my money' lol if they don't hide it.

I am nearest but I am trusted as well but would back down under confrontation I would guess (and moan later).

I have a brother and sister and a half brother and half sister, all married. 5 of us but already the will has only 4 equal shares, 1 brother missing out. (we have no contact with his family) so we have some (Divorce, feuds, resentments ).

My wife has worked for CAB, Age Concern etc and has seen first hand how people behave over Wills, Inheritance etc. It is going to be a thankless task.

Thanks for your insights, it is helping.