What attorneys and deputies need to know about gifting

Amelia Clarke, Court of Protection Solicitor, explains the key things attorneys and deputies should consider before giving cash gifts on behalf of someone who lacks mental capacity.

Understanding your powers when gifting as an attorney or deputy

When acting as an attorney or deputy and gifting on behalf of someone who lacks mental capacity, it’s essential to understand your limited powers. Many assume that holding a power of attorney means you can act exactly as that person would, but this is not the case. The Mental Capacity Act 2005 only allows you to gift in certain circumstances. For example, modest gifts to people related or connected to the donor on “customary occasions”. The gift must be reasonable, affordable and in that person’s best interests. 

Under the Mental Capacity Act 2005, gifting is only permitted in very specific circumstances. Any gift must be:

• Reasonable in size and nature
• Affordable based on the person’s financial situation
• In their best interests

When a Court of Protection is required when gifting as an attorney or deputy

If you wish to make a gift above or beyond your powers, and the person that you act for has lost mental capacity, a Court of Protection application will be required. This includes situations such as:

• Large gifts relative to the person’s estate
• Gifts intended to maintain someone other than the person you represent
• Creating a trust

What counts as a gift under the Office of Public Garden

The Office of the Public Guardian also considers certain actions as ‘gifting,’ such as living rent-free in a property owned by the person or making loans on their behalf.

If you have already made a gift that exceeds your authority, you can apply for retrospective permission from the Court. However, it’s important to note that unauthorised gifting is fraud.

In serious cases, this may be treated as financial abuse, which can lead to criminal sanctions.

Seek advice about your powers as an attorney or deputy

If you are acting as an attorney or deputy and have doubts about gifting or you would like advice on your legal powers, seek specialist advice. Our team of solicitors in Essex and Suffolk can help you understand your responsibilities and ensure any decisions you make are in the best interests of the person you act for.