The term “capacity assessment” comes up in many different contexts, from a family arranging care for an elderly relative to a solicitor preparing a will, a hospital team deciding on treatment, or a court considering a safeguarding matter. Despite how often the phrase is used, many people are unsure what a capacity assessment actually involves, who can carry one out, and what happens once a decision has been made.

This guide explains the legal framework behind capacity assessments in England and Wales, walks through how they are carried out in practice, and outlines the situations in which a private psychiatric capacity assessment may be the right route.

What Is Mental Capacity?

Mental capacity refers to a person’s ability to make a specific decision at a specific point in time. It is not a general label that applies to someone across every area of their life. A person might have full capacity to decide where they want to live but lack capacity to manage a complex financial investment, or have capacity to consent to a straightforward medical procedure while lacking capacity for a major surgical decision involving complicated risks and trade-offs.

This decision-specific and time-specific nature of capacity is one of the most important and most frequently misunderstood aspects of the law. Capacity can also fluctuate. Someone recovering from a delirium, an acute mental health crisis, or the effects of medication may lack capacity on one day and regain it on another.

The Legal Framework: The Mental Capacity Act 2005

In England and Wales, capacity is governed by the Mental Capacity Act 2005. The Act sets out five guiding principles that apply to every assessment.

First, a person must always be presumed to have capacity unless it is proven otherwise. Second, a person must be given all practicable support to help them make their own decision before anyone concludes that they cannot. Third, a person is not to be treated as lacking capacity simply because they make a decision that others consider unwise. Fourth, where someone is found to lack capacity, any decision made on their behalf must be in their best interests. Fifth, any such decision must be the least restrictive option available, interfering with the person’s rights and freedom as little as possible.

These are not informal guidelines. They are legal requirements that every assessor, whether a doctor, social worker or solicitor, must follow and be able to demonstrate they have followed.

The Two-Stage Test

Capacity is assessed using a two-stage test. Following the Supreme Court judgment in A Local Authority v JB [2021] UKSC 52, the order of the two stages was clarified so that the functional element is now considered first.

The first stage asks whether the person is unable to make the particular decision in question. This is assessed by looking at four abilities: can the person understand the information relevant to the decision, can they retain that information for long enough to use it, can they use or weigh that information as part of the decision-making process, and can they communicate their decision by any means.

The second stage asks whether this inability is caused by an impairment of, or disturbance in, the functioning of the mind or brain. This could relate to a long-term condition such as dementia, a learning disability, a mental illness, or a more temporary state such as the effects of intoxication, severe pain, or acute confusion following an injury or infection.

Both stages must be satisfied for someone to be found to lack capacity for that specific decision. A person who struggles with a decision but who does not have an underlying impairment of the mind or brain is not considered to lack capacity under the Act, no matter how unwise their decision may seem to others.

Who Can Carry Out a Capacity Assessment?

In day-to-day situations, capacity assessments are often carried out informally by the professional involved in the decision at hand. A surgeon assessing whether a patient can consent to an operation, a social worker assessing whether someone can decide on their care arrangements, or a solicitor assessing whether a client can give instructions for a will may all conduct a capacity assessment as part of their normal duties.

However, more complex, contested or high-stakes situations often call for an independent assessment by a psychiatrist or other suitably qualified clinician. This is particularly common where there is disagreement between family members, where significant assets or major life decisions are involved, where a will or lasting power of attorney may later be challenged, or where the matter is heading to the Court of Protection. An independent, well-documented psychiatric capacity assessment provides a clear, defensible record of the reasoning behind the conclusion reached, which can be vital if the decision is later questioned.

Common Situations Requiring a Capacity Assessment

Capacity assessments are requested in a wide range of circumstances. Common examples include assessing testamentary capacity, which is the ability to make or change a will, assessing capacity to grant a lasting power of attorney for either property and financial affairs or health and welfare, assessing capacity to consent to or refuse medical treatment, assessing capacity to manage finances or enter into contracts, and assessing capacity to make decisions about where to live, including moving into residential or nursing care.

Solicitors frequently commission independent capacity assessments when drafting wills for older or vulnerable clients, partly to protect the client’s wishes and partly to reduce the risk of the will being contested after death on the grounds that the person lacked capacity at the time it was signed. Families navigating care decisions for a relative with dementia or a progressive neurological condition also commonly seek an independent assessment to support care planning and, where necessary, applications to the Court of Protection.

What Happens During a Capacity Assessment

A private psychiatric capacity assessment typically begins with a structured clinical interview. The assessor will explain the specific decision in question in plain language, free of jargon, and check the person’s understanding at each stage. They will ask the person to explain the decision back in their own words, to identify the relevant risks and benefits, and to describe how they have weighed up the different options available to them.

The assessor will also gather collateral information where appropriate, which may include medical history, any relevant cognitive testing, and, with consent, information from family members or other professionals involved in the person’s care. Every effort is made to support the person to engage with the decision, in line with the Act’s principle that all practicable steps must be taken before concluding that someone lacks capacity. This might include using simpler language, breaking information into smaller sections, choosing a time of day when the person is most alert, or involving an interpreter or communication aid.

Following the assessment, a detailed written report is produced. This sets out the decision being assessed, the information provided to the person, the assessor’s analysis against the two-stage test, and a clear conclusion. The report should stand up to scrutiny, whether it is being used to support a solicitor’s file, inform a family’s care decisions, or serve as evidence in Court of Protection proceedings.

What Happens If Someone Is Found to Lack Capacity

A finding that someone lacks capacity for a specific decision does not strip them of their rights more broadly. Any decision made on their behalf must still follow the best interests principle, taking into account the person’s past and present wishes, their beliefs and values, and the views of people close to them, alongside choosing the least restrictive option available.

In straightforward cases, this might mean a family member or professional makes the relevant decision in the person’s best interests, often with input from a Lasting Power of Attorney if one is already in place. In more complex or disputed cases, the matter may need to go before the Court of Protection, which can appoint a deputy to manage decisions on an ongoing basis or make a one-off ruling on a specific issue.

Seeking a Private Capacity Assessment

Many people seek a private capacity assessment because they need a clear, timely, and well-documented outcome, whether that is for a solicitor preparing legal documents, a family trying to resolve disagreement about a loved one’s care, or an individual wanting clarity about their own decision-making while it can still be properly recorded.

Harley Street Mental Health provides independent capacity assessments carried out by GMC-registered psychiatrists, alongside related medico-legal services for solicitors, courts and other professional bodies, including immigration psychiatric assessments for individuals navigating asylum and visa proceedings. Assessments can be arranged at 10 Harley Street or, where clinically appropriate, conducted virtually, with detailed reports provided to support whatever legal or family process the assessment is needed for.

Capacity law exists to strike a careful balance between protecting people who are vulnerable and respecting the autonomy of every individual to make their own decisions, even unwise ones. A properly conducted assessment, grounded in the Mental Capacity Act and carried out by an experienced clinician, gives everyone involved, the person at the centre of the decision, their family, and any professionals relying on the outcome, the clarity and confidence they need to move forward.