Who would make decisions for your business if you couldn’t?

If an accident or illness left you unable to make decisions, who could authorise payments, deal with contracts or manage your business interests? A trusted colleague or family member may be willing to help, but willingness alone does not give them legal authority.

Planning for incapacity helps clarify who can act and what they can do. For business owners, that means reviewing powers of attorney alongside the way the business is owned and managed.

What is a business lasting power of attorney?

In England and Wales, a lasting power of attorney allows you to appoint attorneys to act within the authority set out in the document. A business LPA is usually a property and financial affairs LPA tailored to specified business interests, rather than a separate third type of LPA.

A health and welfare LPA deals with personal care and treatment decisions. It does not authorise someone to manage your business finances.

Signature Concierge's wills and powers of attorney services include support with business-specific arrangements. Legal advice can help ensure that personal and business instructions work together without conflicting.

Choose authority and experience together

The person you would choose for household finances may not be the right person to deal with commercial decisions. Your attorney needs suitable experience, an understanding of the responsibilities involved and the willingness to act in your best interests.

Consider what access would be needed, which decisions could arise and whether a replacement attorney is appropriate. The instructions must be clear enough to work in practice without imposing restrictions that make essential tasks impossible.

Your business structure affects the answer

Sole traders may need someone to manage business assets and payments held in their own name. Partners should check the partnership agreement and how incapacity affects the partnership.

For a limited company, an LPA should not be treated as automatically allowing an attorney to occupy a director's office or exercise every board function. Shareholder rights, banking authority and company management need to be considered separately.

A review of the articles of association, shareholder agreement and decision-making arrangements may therefore need corporate and commercial legal support alongside the LPA itself.

Put the arrangements in place while you can

You must have the necessary mental capacity when making an LPA, and it must be registered before it can be used. A property and financial affairs LPA can, with your permission and subject to its instructions, be used while you still have capacity.

Without appropriate authority, family members may need a Court of Protection application to manage your affairs. That is a separate process and may not resolve all the company's operational needs.

Review the legal documents together with practical arrangements such as bank mandates, access to essential records and continuity plans. The aim is to make the authority usable when it is needed.

Speak to Signature Concierge today to discuss personal and business powers of attorney with our legal partners.