IHT planning and LPAs
Sean_Fernyhough
Member
What are people's thoughts about this?
Client is elderly and we have historically dealt with his son who is also the attorney. My understanding is that the father has mental capacity but physical health is poor and he much prefers to leave financial matters to his son, knowing that his financial position is such that he is very unlikely to run out of money. I'm aware of the Court of Protection's decisions regarding gifting as part of IHT planning. How applicable are these where the donor has mental capacity but has opted out of making financial decisions?
It seems to me preferable, if the donor has capacity, for him to make any IHT gifts himself. Or for him to be involved in the decision. He's not been involved in lesser financial decisions we've been involved with. If someone is old and suffering physical ill-health then there may be an argument for saying that mental capacity is diminished, at least. In any case the father is vulnerable, and I think the attorney should tread carefully.
Comments
The attorney cannot gift without CofP Permission ( I assume it's a non Scottish case).
The fact they have opted out of making financial decisions doesn't mean they can't make financial decisions and should not prevent them gifting if they still have capacity.
The person will need to gift themselves - whether they have mental capacity or not is a matter of fact based on the circumstances. I believe you should seek the opinion of a doctor if there is any doubt and there could be subsequent issues.