LPAs for Business Owners: The Business Lasting Power of Attorney

A business lasting power of attorney is not a separate legal category. It is a property and financial affairs LPA, the type that covers money, banking and property, used to let a trusted person run business affairs if the owner loses the mental capacity to make decisions (gov.uk, as at July 2026, subject to change).

Many owners already have an LPA in mind for their home and savings but overlook the business, which often depends on one person signing cheques, approving payroll and dealing with the bank. This guide explains how an LPA can cover a business, why some owners make a separate one, and what tends to happen if there is no LPA at all. It sits within our wider estate planning guide, and our fuller explainer covers Lasting Power of Attorney Explained. Figures are current as at July 2026 and are subject to change.

What is a business lasting power of attorney?

It is a property and financial affairs lasting power of attorney arranged to cover business matters. That type of LPA lets your chosen attorney deal with money, bank accounts and property, which is what most business decisions come down to (gov.uk, as at July 2026, subject to change). A health and welfare LPA is separate and deals with care and medical decisions, not the business. Only the financial type is relevant to keeping a business running.

Why business owners often put one in place

An owner who loses capacity without an LPA can leave a business unable to function, because no one may have authority to use the accounts or sign contracts. A property and financial affairs LPA lets a named attorney step in, and it can be used as soon as it is registered if the donor allows, or only once capacity is lost (gov.uk, as at July 2026, subject to change). This is why many owners choose to plan ahead rather than wait.

• Continuity. Bills, wages and suppliers still need paying if the owner is suddenly unavailable.
• Banking. A business account can be effectively frozen where no one else has authority to operate it.
• Speed. An LPA can be used quickly once registered, where a court application generally cannot.
• Choice. The owner picks who steps in, rather than leaving it to a court to appoint someone.

Should the business have a separate LPA?

Many owners make two property and financial affairs LPAs: one for personal finances and a separate one for the business. The reason is that the person best placed to run the business, such as a co-director or senior manager, is often not the person you would want handling your home and savings. Keeping them separate lets you name different attorneys and add tailored instructions or restrictions to each (gov.uk, as at July 2026, subject to change).

Two separate LPAs mean two registrations. Each property and financial affairs LPA carries its own registration fee of £92, so two would come to £184 before any reduction or exemption (gov.uk, LPA fees, as at July 2026, subject to change). A reduction may apply on a low income and an exemption on certain means-tested benefits (gov.uk, as at July 2026). One point to check with a qualified professional is how to word each LPA so the two attorneys do not overlap or conflict.

Source: gov.uk/power-of-attorney, as at July 2026, subject to change. Fees are before any reduction or exemption; professional fees to prepare the documents are separate and vary.

What happens to a business without an LPA?

If an owner loses capacity and has made no LPA, the family generally cannot make one on their behalf, and no one may have automatic authority to run the business. Someone would usually have to apply to the Court of Protection to be appointed as a deputy, a process that is generally slower and more expensive than using an LPA already in place (gov.uk, becoming a deputy, as at July 2026, subject to change). In the meantime, a business bank account can be effectively frozen and decisions can stall.

For a small business, even a few weeks without anyone able to pay wages or suppliers can cause lasting harm. This is one reason many owners choose to put a property and financial affairs LPA in place while they are well, rather than relying on a court application later (gov.uk, as at July 2026, subject to change).

Timing and mental capacity

An LPA can only be made by someone who still has the mental capacity to understand it, so it has to be set up before capacity is in doubt (gov.uk, as at July 2026, subject to change). For a business owner, leaving it late carries an added cost, because a company or a customer base can lose value quickly if no one can make decisions. Our guide on Lasting Power of Attorney Explained covers the capacity test in more detail.

Business LPAs in Scotland and Northern Ireland

This guide describes the law of England and Wales, where a property and financial affairs LPA is registered with the Office of the Public Guardian. Scotland has its own continuing power of attorney for financial matters, registered with the Office of the Public Guardian (Scotland). Northern Ireland uses an enduring power of attorney for financial affairs, with separate arrangements for health and welfare. An owner whose business or personal affairs touch more than one UK nation can find it worth taking advice in each. For the wider picture, see our estate planning guide.

Frequently asked questions