Probate

What is estate administration?

Estate administration means dealing with the practical and legal implications following the death of a person including establishing and collecting or transferring assets to a beneficiary, applying for Grant of Probate, dealing with inheritance tax, capital gains tax and income tax.

Can anybody just collect in/transfer a deceased person's assets?

No, it is not just a case of looking at who the next of kin is. If there is a Will, the Executor named in it will be responsible for collecting in or transferring assets.

If no Will exists or there is an in-effective appointment of an Executor in the Will, the law sets out who is responsible for dealing with the estate, this includes who should deal with the transfer or collecting in of assets.

How is the funeral bill paid?

The funeral bill can normally be paid out of a deceased's bank account, although banks and building societies have their own rules as to whether they release funds.  If a member of the deceased's family pays the invoice, they should be entitled to be reimbursed from the estate.

Does the value of a deceased's estate affect what needs to happen?

Yes, the general rule is that if the deceased’s estate is more than £5,000, then a legal document known as a Grant of Representation should be obtained. Careful consideration will need to be given to any jointly owned assets, as the way they are held can affect whether a Grant is required.

Despite the £5,000 rule, if all of the deceased's assets were held with one organisation, such as the same group of banks, then a Grant may not need to be obtained despite the fact that the assets are anywhere up to £15,000/£20,000.  Banks have different rules, so you/we will need to check with the individual bank as to whether they need a Grant of Probate.
 
What is a Grant of Representation?

This is another name for a Grant of Probate (where the deceased left a Will) or a Grant of Letters of Administration (no Will or there is an invalid appointment of an executor).  A Grant of Representation is a Court Order, which confirms or confers the Executors/Administrators authority. Administrators apply where there is no Will or effective appointment of Executor/s within the Will. The latter may arise where the Executor/s named in the Will have passed away.

How you obtain a Grant of Representation?

A Solicitor can act on behalf of the Executor/Administrator in preparing the application for the Grant. Alternatively, it can be applied for in person, meaning the Executor/Administrator themselves attend the Court.

What type of information is required for the Grant application?

Details of the deceased's assets and liabilities will be required including the value of investments at the date of death. Assets include personal belongings (e.g. car, jewellery and furniture), investments,  life insurance policies, pensions, property etc. Also included are any jointly owned assets including bank accounts. Valuations may need to be obtained for a house, household items/jewellery in certain circumstances.

What happens next?

The value of assets are listed in an Inheritance Tax Account (click here for further information on inheritance tax). Despite the fact that no inheritance tax may be payable on the estate, an Inheritance Tax Account will still need to be completed. It will form part of the Grant application.

In addition, an Affidavit (a sworn statement) will need to be prepared, which is signed by the Executor/Administrator in the presence of an independent solicitor. The Executor/s will state that they have been appointed under the Will to deal with the deceased's affairs, whilst the Administrator/s set/s out their relationship to the deceased, confirming why they are entitled to make the Grant application. The value of the deceased's estate is included on the Affidavit, together with a promise that the estate will be distributed in accordance with the Will or with the rules of intestacy and general law. The intestacy rules are complicated and important as they detail who should benefit from a deceased's estate where there is no Will. If there is a surviving spouse/civil partner, it does not automatically mean that they will be entitled to the entirety of their spouse's/civil partner’s estate. There is no such thing as a “common law” spouse if you are not married and living together, you will not be entitled to inherit anything under the rules of intestacy.  In such circumstances a Will should be drawn up or you may need to seek advice as to your right to claim under the Inheritance (Provision for Family and Dependants) Act 1975.

Does any inheritance tax need to be paid before the Grant application may be submitted?

Yes, if inheritance tax is payable, a first instalment of inheritance tax will need to be paid. Normally funds can be obtained from the deceased's bank account but this is not always the case.

If the deceased does not have readily available funds, the Executor/Administrator may need to apply for a bank loan.

What happens after the Court has issued the Grant of Representation?

• The Grant of Representation will need to be registered with the organisations/institutions at which the deceased had assets and accounts closed and investments cashed/transferred.


• All debts need to be discharged. Debts may consist of the following: - overpayment of state or council benefits, care home fees, utility bills, outstanding inheritance tax payments etc.

• Clearance from HM Revenue & Customs will need to be obtained if inheritance tax is payable on the estate. The idea of clearance is to confirm that there are no further queries to be raised in respect of the estate and all tax has been paid. In certain circumstances tax may be paid over a period of years by instalments, although interest may be charged.

• The final stage is for the estate to be distributed to the appropriate beneficiaries.

• A Solicitor will normally prepare an Estate Account detailing money received in respect of estate, the debts paid and amount due to each beneficiary. The Executor/Administrator are asked to approve the accounts before any money is distributed. In some cases beneficiaries may have received interim payments.

Why is it important that all debts are settled?

The personal representatives (i.e. the person/s dealing with the deceased's estate) are liable for all the debts of an estate, whether or not they are aware of them, They can be held personally liable if all the assets are distributed before a debt is paid. Consideration needs to be given as to whether to place an advertisement in the London Gazette and local newspaper (being the place nearest to where the deceased owned property/lived). Such advertisement relieves them of their liability, as any creditors of the deceased are given a period of two months from when the advertisement was placed, to come forward with any claim. Where the personal representative is also one of the beneficiaries under the estate (or even the sole beneficiary), the creditor can still claim any money due, despite the expiration of the 2-month period.

What timescales are involved?

The part that tends to take the longest is collating details of the values of the deceased's assets as at the date of death and thereafter completing the Grant of Representation application papers. This can take anywhere between 1 - 3 months, depending on the complexity of the estate.

Once the application for the Grant of Representation is made, it normally takes 2-3 weeks to be issued by the Court, although when inheritance tax is payable, the payment of inheritance tax from a bank has to be completed before the Grant of Representation can be issued.

Registering the Grant of Representation with the organisation/s at which the deceased owned assets could take between 3 - 8 weeks, depending on the number and type of assets.

Based in Braintree, Essex we are on hand locally to offer advice or help when you need it.
If you need any help with a deceased person's estate, please speak to a member of our estate administration department. Contact: Susan Carlile, Michelle Fireson or Lea Garton.

01376 321311

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The Team

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