If the person you want to help has lost mental capacity

Money Advice Service

If someone really can’t manage their own affairs, you can arrange to manage them yourself for them. You’ll usually be carefully monitored to make sure that you’re always acting in the person’s best interests, and you will be restricted with the types of financial decisions you can make – every case is different.

Before you can begin, you need to check if the person really has lost the ability to make their own decisions.

Checking if someone has lost mental capacity

In general, unless it’s a person who has mental capacity and gives you permission through an ordinary power of attorney you can only take over managing someone’s money if they’ve lost mental capacity. The first thing to do is to check whether this is true.

You should check whether they can:

  • Weigh up the pros and cons of a decision about their money
  • Understand the kind of decisions they might need to make about their money
  • Communicate with you to make their decision clear (even if it’s a blink of an eye or a squeeze of a hand)

If they can do these things, the law says they have the capacity to make their own decisions.

The Mental Capacity Act Code of Practice gives more detailed guidance on how to assess someone’s ability to make decisions.

Find out more about the Mental Capacity Act and download the Code of Practice on the GOV.UK website.

If someone has mental capacity there are still ways you can help them manage their money or prepare for the future. Read more about this in our guide.

If you’re sure the person hasn’t got mental capacity

Top tip

Always check if the person has an enduring or lasting power of attorney set up. If they do, it might save a lot of time and effort.

If you’re sure someone doesn’t have mental capacity, you can still get the right to manage their money for them.

However, you have to apply to a court to get this right.

There are a few steps to follow to get this done:

Step 1 – Check for an existing power of attorney

The person might have set up an enduring or lasting power of attorney already.

Ask them, their family or their solicitor, and if they can’t tell you, you can check with the official body for where they live.

If you find there is such a power of attorney already in place you should register it (if that’s needed) if you’re named as the attorney or contact the attorney if you’re not. The office you or the attorney contacts will tell you how.

Step 2 – Apply for the power to manage a person’s financial affairs where there is no existing power of attorney

If the person you want to help doesn’t already have a power of attorney in place, you need to make different arrangements.

You’ll have to make a formal application to the right agency, and they’ll want to see proof that the person you’re applying for has lost mental capacity.

You can find instructions and paperwork for your application on these websites:

You will have to pay an application fee. It can take several months to get the paperwork properly sorted out.

To avoid getting confused by the language it’s important to know that you won’t be called an ‘attorney’ if you make this kind of application.

Although you’ll usually have the same power as an attorney to manage the financial affairs of the person who has lost mental capacity.

  • In England and Wales, you’ll be called a deputy.
  • In Scotland, you’ll be called a guardian.
  • In Northern Ireland, you’ll be called a controller.

Step 3 – Show the document to the person’s bank

Once you’ve completed the application process you’ll get an official document confirming that you’ve got the power to act.

You’ll need to show certified copies of the document (which have been copied by someone at a bank or solicitor’s office) to any financial organisations that you want to give instructions to – for example, the person’s bank or insurance company.

You can do this as and when you need to, but it’s a good idea to show the document to every organisation you want to deal with as soon as you get it.

They will keep the details on file, which will save you time later on.

Step 4 – Manage the money according to the rules

When you manage money for another person in this way you must always:

  • Make decisions in the person’s best interests
  • Only make the decisions that the court says you can
  • Take care in making your decisions

This kind of power over someone’s financial affairs can sometimes be abused, so the office that set it up will want to check now and then that everything’s legal and above board.

This means you have to keep clear accounts and note down the reasons you’ve made particular decisions.

Find out more about becoming a deputy and your responsibilities on the GOV.UK website.

This article is provided by the Money Advice Service.

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We hope you find Rest Less Money a useful resource and we would welcome your feedback at [email protected] on how to make it even better. For more information on any of the above you can read our full terms and conditions.

Some important information about Rest Less Money

We want you to understand the positives, but also the limitations of using our site. We operate in a journalistic manner and therefore all information, guidance or suggestions provided are intended to be general in nature, and you should not rely on any of the information on the site in connection with the making of any financial decision.

When we set out to build Rest Less Money, we wanted to be a trusted place where you could find helpful information about financial matters affecting the over 50s. As a free to use resource, we try hard to provide the best information we can, but we cannot guarantee that we won’t occasionally make mistakes. So please note that you use the information on our site at your own risk, and we can’t accept liability if things go wrong.

Key things to remember when using Rest Less Money:

We do not offer financial advice – As a journalistic site, it’s important to know that we do not provide financial advice. You should always do your own research before choosing any financial product so that you can be certain it is right for you and your specific circumstances. If you are in any doubt, please seek professional financial advice from a regulated financial advisor.

No Liability – please note that you use the information on Rest Less Money at your own risk and we can’t accept liability for how you choose to use the information given on our site. We will often provide links to content or products and services available on other third-party websites. These are provided purely for your convenience and we cannot be held responsible for any content, or any of the products and services offered on any website that we link to.

 

Accuracy of Information – We try to make sure that all the information provided on Rest Less Money is correct at the time of publishing as we want it to be the most helpful resource possible. Sadly, we are not perfect however, and so we can make no guarantees as to the completeness, accuracy, adequacy or suitability of the information available on the site.
Whilst we work hard to try and provide accurate information, deals and prices can change, so whilst they may be correct at the time of writing, providers may subsequently decide to alter them later – so always double check first.

A final note on the Rest Less Community Forums – always remember that anyone can post their opinion on the Rest Less Community Forums, so it can be very different from our own opinion and may not be factual or well researched. Always be wary of any content posted on the forums and be sure to do your own research and due diligence on anything suggested. 

We hope you find Rest Less Money a useful resource and we would welcome your feedback at [email protected] on how to make it even better. For more information on any of the above you can read our full terms and conditions.

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