“Hi, I Have Power of Attorney”: Why Every Business Owner Should Prepare for the Worst

It was some time ago now. One of our longest-serving clients, someone we’d worked with for years, had been diagnosed with cancer. Serious, fast-moving. He ran a substantial commercial property business. But suddenly, he was in a hospice. And nobody knew what was going to happen.

That’s the thing about working in accountancy: you don’t just deal with numbers. You deal with the best and worst moments of your clients’ lives — births, deaths, marriages, business sales, family breakdowns. It’s a privilege. But it can be brutal.

In this case, things were looking bleak. We were preparing for the inevitable. Who would deal with the accounts? What about the rent payments? The VAT returns? The payroll? What about supplier payments? We weren’t sure. Until, one day, we got an email.

“Hi, I’m John. I have Power of Attorney for Paul. Do you think you can help me?”

And just like that, everything changed. John had the authority to act. We were able to talk to him, work with him, and carry out instructions. He was even able to ask the bank for access to the business’s funds. The business carried on. Calmly. Cleanly. Legally. John was an experienced business owner himself who had known the client for years and had been the perfect choice for a power of attorney. 

And all because the client, at some point when he was still well, had put a Lasting Power of Attorney (LPA) in place.

What is an LPA?

A Lasting Power of Attorney is a legal document that gives someone you trust the authority to act on your behalf if you lose the capacity to make decisions.

There are two types:

• Health and welfare — for decisions about medical care, living arrangements, end-of-life
  
  
• Property and financial affairs — for managing money, paying bills, accessing bank accounts, and yes, running your business

The one you need to think about as a business owner is the financial LPA. Because if you become incapacitated, temporarily or permanently, your business grinds to a halt unless someone has legal authority to act.

🔒 Why It Matters for Business Owners

We often think about LPAs in the context of elderly relatives, especially with dementia. I’ve seen that too, countless times.

But for business owners, the impact is different. It’s not just about your personal money. It’s about:

• Paying your staff
  
• Accessing business bank accounts
  
• Authorising payments
  
• Signing off on year-end accounts
  
• Communicating with HMRC
  
• Jepodising a future sale
  

Without an LPA in place, no one—not even your spouse or your accountant-can legally act for you. Your business could become legally paralysed overnight. 

It's a good idea to find someone who has some business experience or knowledge of your financial affairs. 

Capacity Isn’t Binary and It Isn’t Just Old Age

You don’t need to be elderly to lose capacity.

A head injury. A stroke. Complications during surgery. Even severe mental health episodes. These things happen. And they don’t come with a warning.

LPAs aren’t about pessimism. They’re about resilience.

The Good News: It’s Easy to Set Up

You can create an LPA online through Gov.uk for £82. You don’t need a solicitor, though I’d recommend using one if your affairs are complex or involve business assets.

You’ll need:

• A person (or people) you trust to act as your attorney
  
• A certificate provider (someone who confirms you understand what you’re doing)
  
• Signatures and witnesses
  

Once registered, it’s valid indefinitely and only used if you lose capacity.

Final Thought

I’ve seen this go wrong, and I’ve seen it go right.

In my client’s case, everything could’ve collapsed. But one signed form changed everything.

We often focus on the exciting parts of being in business, growth, profit, and success. But true professionalism is preparing for the things you hope never happen.

Put an LPA in place. It’s one of the simplest, smartest things you can do.