Appointing a power of attorney is a crucial part of planning for the future, when you may be unable to manage your own finances and needs. Having a power of attorney in place is useful, both in the event of an accident, illness or unforeseen circumstances which may put you out of action temporarily, as well as towards the end of life where assistance might be needed.
Appointing Power of Attorney
Most people appoint a family member to assist in such an event but you can appoint a legal professional and it is possible to appoint a power of attorney online, for example at powerofattorneyonline.co.uk.
Power of attorney is an important and responsible role, so it’s vital to nominate a trustworthy individual. There are strict laws in place on exactly how finances can be managed and how decisions should be made. However, even the most trusted person could unintentionally abuse their financial power.
Gifting
One of the most common causes of accidental or unintentional abuse is the allocation of gifts. There have been cases where an appointed power of attorney has allocated funds for themselves and noted it as gifts, which they feel they are entitled to.
An appointed power of attorney does have the power to make gifts to the donor’s friends and family members on occasions where they would normally do so, such as birthdays or anniversaries. It’s also possible for them to make donations to charities that the donor would normally make or would not object to, for example if they have been regularly donating to a specific charity.
In other circumstances, legal approval must be sought in order to make financial gifts or donations. For example, paying school or university fees, making interest free loans or allowing someone to live in a property free of charge or at below the market value. This is the case even if these kinds of gifts have been made before. It’s therefore vital when taking on the role of attorney to fully familiarise yourself with the legal responsibilities and duties and maintain accurate and up to date records.