Because of family circumstances, it has been suggested to us that we should think about an enduring power of attorney (EPA). We are a married couple both in our 70s, our home is in joint names, as are virtually all our savings. Is an EPA really necessary in relation to couples such as us, being as it is a complex and expensive procedure?
Surely a spouse can make care decisions and/or financial decisions in the event of his/her partner becoming mentally infirm.
Also, having looked up various sources of information, it seems that a spouse cannot be appointed as the attorney since the regulations state that the spouse must be one of the "notice parties", and a notice party cannot be the attorney. This to us seems quite strange and we wonder are we misreading the regulations.
Mr P McB, Dublin
An enduring power of attorney is potentially a very wide-ranging power to grant to anyone to manage some or all of your affairs – including potentially your personal care – should you become incapacitated. For that reason it is not something to enter lightly.
However, there are very good reasons for considering it.
The bottom line is that, should you become mentally incapacitated for any reason, you would presumably wish the person making decisions on your behalf is someone you know and trust, and preferably someone whom you have briefed on your preferences in the case of a such an eventuality.
You point out that you are both in your 70s with most assets in joint ownership. Of course, it is possible that should something happen one of you, the other could make decisions about such matters, but what if both of you fell ill together or within a short time of each other, such that neither of you was in a position to make those decisions?
That is the purpose of enduring power of attorney.
The process is covered by the Powers of Attorney Act 1996 and related regulations, the Enduring Powers of Attorney Regulations 1996 (SI No 196/1996). These were amended in 1996 by another statutory instrument, SI No 287/1996.
Because of the complexity of the issue and the pretty dramatic impact it can have for people, anyone looking to create an enduring power of attorney requires the certification of both their GP and a solicitor stating that they are aware of what they are doing and are not acting under duress. They also need to confirm that themselves.
That said, it is not necessarily an expensive process and there is a standard form that can be used.
On more prosaic matters, just because you consider an enduring power of attorney, you do not have to hand over all power. You can, for instance, choose to retain control over personal care or any other area(s). There is also nothing to stop you having more than one attorney within the same document. You can even allocate different responsibilities to each attorney.
In terms of exercising control, if you have more than one attorney, you can set down either that they must agree with each other before any action is taken or that they can act independently of the other.
Getting back to that one issue which concerned you, there is nothing to stop you, or your wife, making the other spouse as the attorney, or one of them.
You refer to the notification process. The first thing stated is that those being notified cannot be the attorney or one of them.
Thereafter, the order of priority is that you notify a spouse, children or more distant relation – such as a sibling etc.
If you wish your spouse to be an attorney, you simply exclude them from the notification process in this section and move on to the next lower level in the priority order.
You will, in any case, also have to notify your selected attorney(s) and they have the option of accepting or declining to act in that role.
Once all the paperwork is done, it has to be registered with the High Court. Thereafter, it cannot be enforced without reference to the court. Essentially, it would require the court to be satisfied from a doctor that you were no longer mentally capable of making decisions for yourself.
So there are quite a few checks and balances. However, it is a big decision which is why it is certainly worth reading into. Citizen's Information have a good primer on their website and it could point you to other more detailed information.
I suppose, in the end, it is a case of figuring out what needs to be done for you and for your assets if you are no longer capable of handling your affairs.
Without a power of attorney, things can and do get very messy.
Do new UK rules on non-resident capital gains apply to NI? I read about the recent changes to rules on capital gains for non-UK residents on sale of property. Can you tell me if these rules apply to property in Northern Ireland as well?
Ms MT, email
The rules you refer to kicked in on April 6th last year. If you are not a UK resident for tax purposes and have property in the UK, you will face a potential capital gains tax charge on the eventual sale of that property.
In assessing any liability, you need only to look at the increase in value of the property from April 6th last year to the date when you sell it – not from the original purchase date. Of course, that means holders of such property would need to have some understanding of the value of their property on that date: it might be worth talking to a valuer on that.
There is also an exemption for the final 18 months of ownership under UK capital gains tax rules, so, taking April 6th last year as a starting point, it means you would not have to worry about capital gains on any sale occurring before October 5th this year.
The rules apply to all UK property, so certainly property in Northern Ireland would count.
It’s like a lot of things across that Border; it is a pretty unique situation but it does get caught up in more general rules that were essentially designed to stop very wealthy foreign domiciled investors building up valuable property portfolios – especially in London and the south-east of England – without facing any tax liability.
Send your queries to Dominic Coyle, Q&A, The Irish Times, 24-28 Tara St, D2, or email email@example.com. This column is a reader service and is not intended to replace professional advice.