The Office of the Public Guardian have this month issued updated guidance on gifting for both Deputies and Attorneys on behalf of P.

Both Deputies and Attorneys must follow stricter protocols when giving gifts on behalf of P. The gifts must coincide with past habits and financial means and need to comply with the MCA 2005. Approval must be sought from the Court of Protection when making gifts, with the exception of small customary amounts such as for birthdays, holidays and other similar events.

It is necessary to ensure that when making gifts, the Deputy or Attorney are acting in P’s best interests given their wishes, feelings and financial position. Also, a sufficient paper trail should be kept to explain how the decision was arrived at and what factors were taken into account.

The Deputy or Attorney must consider whether P has:

• The capacity to understand the decision to make a gift;
• Whether P is able to take part in the decision making process.

What cannot be given as a gift:

• A loan
• Making a large gift
• Creating a trust over P’s property
• Living rent free in a property owned by P
• Selling a property for less than its value or transferring property into another name
• Changing a Will by a deed of variation
• Maintaining and support another person
• Removing cash assets to reduce P’s estate

Exceptions include gifts given to friends and family on customary occasions such as birthdays, weddings and religious celebrations, gifts that were previously given either to a person or charity and must be of reasonable value, taking into account the circumstances and the size of P’s estate.

What is deemed as a reasonable gift?

Various factors must be taken into account including:

• The impact of the gift on P’s estate;
  • Whether making the gift is in P’s best interests; and
  • The current and future needs of P.

A best interests decision should be made and properly recorded including details of all other issues taken into account. These include P’s previous habits, how the gift may affect an inheritance and the payment of inheritance tax. P’s life expectancy should be considered together with P’s future financial position and the relationship between P and the person receiving the gift also, importantly P’s wishes and feelings, taking into account any previous Wills prepared.

For the full guidance please click on the link giving-gifts-guidance.pdf (publishing.service.gov.uk)

If you have any questions on the information above or have any general queries with regard to seeking costs, please contact me at Tanya.Foran@clarionsolicitors.com.