This week is Dementia Awareness Week and consequently a great opportunity to unite against dementia. As a Dementia Friends Champion, I feel it is important to encourage others to make a positive difference to people living with dementia in their community. Dementia Friends Champions provide information about the personal impact of dementia and encourage communities to take positive action to help those affected by dementia. As a solicitor specialising in Tax, Trusts and Estates, I also understand how crucial having a valid will and Lasting Powers of Attorney (LPA) are for those affected by dementia and what a comfort it can be to know that your affairs are in order (you can find my previous article for National Dementia Carer’s Day on the importance of wills and LPAs here).
Symptoms of dementia often become worse over time and it is crucial to make plans for your future if you or one of your loved ones has had a diagnosis. In order to put in place legal documents such as a will or LPA, you must be deemed to have mental capacity at the time you put each document in place. If not, you and your family can face very real, very time consuming and very expensive difficulties in sorting out your affairs.
A valid will allows you to confirm how you wish your estate (your money, property and possessions) to be distributed following your death. Without a valid will your estate will usually pass under strict legal rules known as the “intestacy rules”.
People are often surprised at how the rules of intestacy work (see our intestacy flowchart here) and you should never assume that your estate will pass to your loved ones. With more and more people challenging the distribution of estates (see my top ten tips on preventing your will from being challenged), even if a claim is brought against your estate, a valid will is at the very least confirmation as to how you wish your estate to be divided at the end of your days.
If you have been diagnosed with dementia it does not mean you cannot put a will in place as you could still have “testamentary capacity” (capacity to make a will), in particular in the early stages. Nonetheless, the sooner you put a will in place, the lower the risk of having an issue with testamentary capacity. You may already have a will in place, but perhaps this was drafted several years ago, maybe when your children were first born, and no longer meets your needs. You may have personally inherited further assets yourself, and may also wish to take advice in relation to inheritance tax or putting some sort of trust in place (either in your will or during your lifetime).
The law has also seen many changes recently, for instance with the recent introduction of the residential nil rate band, a further “uplift” of the inheritance tax free amount available in some circumstances for passing on the family home.
Lasting Powers of Attorney
It is not only important to plan for your loved ones following your death, but also to ensure that the legal mechanisms are in place during your lifetime so that there someone you trust can be legally appointed to make decisions on your behalf and in your best interests, should you lose mental capacity.
For LPAs, as with any other decision, mental capacity is assessed at the material time and either someone who has known you for at least 2 years or a professional experienced in dealing with LPAs (such as your GP or solicitor) needs to sign the LPA confirming that you have understood and wish to put the LPA in place.
By putting in place an LPA, you can appoint persons of your choosing to make decisions on your behalf if or when you are unable to do so. There are two different types of LPAs, one for health and care decisions and one for financial decisions.
What if a loved one has already lost capacity?
If someone you know has lost capacity then all is not lost.
It may still be possible to apply to the Court of Protection to make what is known as a “statutory will”. This is a will made on behalf of a person who lacks testamentary capacity.
Similarly, if someone loses capacity before appointing an attorney to manage their affairs then it is possible to appoint a deputy to do so.
If you want to discuss any of the matters raised in this article then please feel free to contact the Tax, Trusts and Estates team.
Please visit the Alzheimer’s Society website to see how you can take part in Dementia Awareness Week.