Does having a Lasting Power of Attorney mean I can avoid probate?

There is a common misconception that having a Lasting Power of Attorney (LPA) in place means that your family can avoid probate when you die.

But this is not the case.

What is a Lasting Power of Attorney?

A Lasting Power of Attorney is a legal document that allows you to appoint one or more people (known as attorneys) to make decisions on your behalf, either immediately or if you are no longer able to make those decisions yourself, depending on the type of LPA and the instructions you have given.

There are two different types of LPA in England and Wales:

Property and Financial Affairs – this allows your attorneys to deal with matters relating to your finances, such as managing your bank accounts and investments, paying bills and dealing with property.

Health and Welfare – this allows your attorneys to make decisions relating to your health and care, such as where you should live and, depending on the authority you have given, consenting to medical treatment on your behalf.

But both types of LPA have two very important things in common:

1. They must be made by the person giving the authority to the attorneys while they have the mental capacity to make the LPA; and
2. When that person dies, the LPA and the authority it gives to the attorneys comes to an end.

This means that an attorney acting under an LPA during someone’s lifetime cannot simply continue to access their bank account after they die under the LPA, sell their property or distribute their assets.

What happens after death?

When someone dies, their estate needs to be administered. This may involve identifying the assets and liabilities within the estate, paying any Inheritance Tax that is due, collecting assets, paying debts and distributing the estate to the beneficiaries.

If a Will has been left, the Executors may need to apply for a Grant of Probate in order to deal with certain assets and administer the estate.

If a person dies without a Will, the process is slightly different. An Administrator may need to apply for a Grant of Letters of Administration.

The authority to deal with a person’s estate therefore comes from their Will and the Grant of Probate (where applicable), or from the Rules of Intestacy where there is no Will not from an LPA.

Power of Attorney and Probate

A Power of Attorney and probate are two completely different things. This can cause a lot of confusion, and we often hear people say that they don’t need probate because they had a Power of Attorney for the person who has died.

An LPA does not eliminate the possibility of probate being required.

A Power of Attorney allows you to act on behalf of another person during their lifetime, making decisions about their finances or health and welfare, depending on the type of authority given.

After that person’s death, the LPA comes to an end and responsibility for administering their estate passes to their personal representatives — usually the Executors named in the Will or, where there is no Will, the Administrators.

A person who has been appointed as an attorney under an LPA may also be appointed as an Executor under the Will. However, even in this situation, the LPA itself does not give them authority to deal with the estate after death, and a Grant of Probate may still be required.

Whether probate is required depends on the circumstances of the estate, including the assets involved, how they are owned and the requirements of the relevant asset providers.

Key takeaways

• LPAs and probate are not the same thing.
• An LPA and the authority it gives to attorneys come to an end when the person dies.
• Having an LPA does not mean that probate can be avoided.
• Whether probate is required depends on the circumstances of the estate and the assets involved.

How can Taylor Bracewell’s Wills, Probate & Trusts team assist?

If you would like more advice in regards to Lasting Powers of Attorney and Probate, our friendly Wills, Probate & Trusts team can assist. You can contact our Doncaster solicitors on 01302 341414 or our Sheffield solicitors on 0114 272 1884. Alternatively, you can fill out our online enquiry form.