On a personal note thank you very much for the way in which you have handled the legal support surrounding my dad's estate. I have found your advice to be very useful and the sympathy you have shown when we have communicated has been welcome.
Source - Client thank you letter to Sue Carlile of the Wills & Probate department
Jargon Buster
Administration
The process whereby the Executor/Administrator manages the deceased's affairs. This will include collecting the assets, discharging any debts and distributing the assets in accordance with the terms of the Will/intestacy.
Administrator/Administratix
The person appointed by the Court to administer the deceased's estate where there is no Will or in cases where there is a Will but a valid executor has not been appointed.
Asset
An item which has some value attached to it such as an investment, cash, property and land.
Beneficiary
Someone who receives a gift from a Will.
Capital Taxes Office
HMRC department responsible for inheritance tax.
Chattels
Personal property including cars, jewellery, collections, household items (antiques, paintings, furniture etc).
Codicil
A document which stands alongside the original Will. It amends the Will by means of additions and/or alterations.
Deed of Variation
The terms of a Will can be varied up to 2 years after a person has died. This is subject to the agreement of the beneficiaries and there may be inheritance tax implications of varying the Will or rules of intestacy if there is no Will. It is important to seek independent legal advice.
Discretionary Trust
Where trustees hold property for a group of selected beneficiaries but operate/manage the trust at their entire discretion. The trustees decide who benefits, how they benefit, when they benefit and indeed, if they benefit at all.
Estate
The value of a deceased's assets as at the date of death (less any debts).
Executor/Executrix
The person/s appointed under the Will to deal with the administration of the estate.
Exempt Gifts
For Inheritance Tax purposes, primarily gifts below £3,000 per annum, gifts between spouses and civil partners and gifts to charities and political parties.
Funeral Arrangements
Such arrangements can be expressed in the Will, such as a desire to be buried or cremated. Directions can also be made regarding the funeral service and where the ashes are to be interred.
Grant of Representation (Grant of Probate/Grant of Letters of Administration)
This is a Court Order, which confirms or confers the Executors/Administrators authority. It is issued by the Probate Registry. It is the generic term for a Grant of Probate and Grant of Letters of Administration.
Grant of Letters of Adminstration
This is a legal document, which confers powers on the Administrators of an estate where there is no Will or in cases where there is a Will but a valid executor has not been appointed.
Inheritance Tax (IHT)
The tax which is payable on the part of the estate which exceeds the nil rate band allowance. Tax is charged at 40%. When calculating the tax payable, consideration will need to be given to any gifts made by the deceased within the last 7 years and also any assets held in trust. Some lifetime gifts will also be liable to IHT.
Intestacy
This describes the situation when a person dies without making a Will.
Intestate
Where a person dies without leaving a Will or a valid Will.
Joint Assets
These are assets which are held in joint names with another person, such as land and bank accounts. There are two ways in which joint assets can be held, either as joint tenants or tenants in common (see below).
Joint Tenants
The property is owned jointly so that all the owners have an equal interest in the property. If one owner dies then the survivor/s will automatically own the whole of the property. Please also see tenants in common.
Legacy
A gift made under a Will. There are many different forms of legacies, which are as follows:
Specific Legacy - where an item is specifically identified such as a Rolex watch, a car or a home.
General Legacy - a gift of a specified sum of money.
Residual Legacy - a gift of a balance of an estate (in money or property) after payment of debts, expenses, legacies, funeral costs and IHT (if applicable).
Liabilities
The debts of an estate, which must be settled before payment to the beneficiaries. The order of payment depends on whether the estate is solvent or insolvent.
Life Interest Trust
Where a beneficiary under a Will has the right to receive income for the duration of his or her lifetime or has the right to occupy the property in his or her lifetime.
Nil Rate Band Allowance
This is the amount of an estate which is not subject to any IHT. The Nil Rate Band for 2008/2009 is £312,000, for 2009/10, £325,000, 2010/11, £350,000. Each person has a nil rate band allowance.
A claim can be submitted for the transfer of any unused nil rate band on the death of a surviving spouse or civil partner within 2 years of the end of the month in which the surviving spouse/civil partner dies.
Nominated Asset
Where a Beneficiary is selected to receive a particular asset on the deceased's death. Such assets pass outside the Will/Rules of intestacy and therefore no Grant of Representation needs to be produced to the asset holder for the transfer to the beneficiary to be effected. However, for IHT purposes the gift has to be reported to HMRC.
Oath
A legally binding pledge in which for probate purposes you swear the contents of the application papers as being true.
Personal Representative
The person who deals with the deceased's estate, known as the Executor or Administrator.
Potentially Exempt Gifts/Transfers (PETS)
Lifetime gifts where the donor must not reserve a benefit (see Reservation of Benefit) and must survive the date of the gift by 7 years. If donor does not survive by 7 years, the gift becomes chargeable to inheritance tax although a discount to the IHT payable may be available.
Probate
This is the process of proving the Will i.e. checking its validity. If the deceased left a Will, then probate confirms the validity of the Will and the Executor's authority to act. If there was no Will or the Will is deemed invalid, then an Administrator will need to apply for the Grant of Letters of Adminstration.
Probate Registry
It is part of the Family Division of the High Court and repsonsible for issuing the Grant of Representation.
Protected Trust
A specific trust designed to protect disabled beneficiaries.
Proving the Will
This term describes the application to the Probate Registry for the Grant of Representation.
Registrar
The person who formally records the death. All deaths must be registered with the Registrar in the area where the death occurred.
Renunciation
Where an Executor appointed under the Will does not wish to act - he/she renounces his/her appointment.
Reserve Executor
Where an Executor does not act as an Executor but retains the right to step in as an Executor at a future time.
Reservations of Benefit
Where a gift is made but the donor retains an interest in the gifted property (e.g. gives away his/her home but continues to live there). For IHT purposes the gift fails and the value of the gifted assets form part of the estate for calculating IHT. (It is essential to take legal advice).
Residue
This is the money in the estate left for distribution after payment of debts, expenses, legacies, funeral costs and inheritance tax (if applicable).
Tenants in Common
Each owner has a specified share of the property and is able to leave their share of the property to whoever they choose. See also Joint Tenants.
Testator/Testatrix
The person making the Will (male - testator - female - testatrix).
Trust
An arrangement whereby assets are held by Trustees on behalf of a beneficiary who does not own the asset outright e.g. Wills containing gifts subject to a beneficiary reaching a certain age (e.g. 21); wills containing a right to live in a property for life; Wills containing protection on a beneficiary because of financial, matrimonial or personal problems. A trust will normally arise where there are minor beneficiaries under the Will and their inheritance is to be held until they attain a specified age.
Trustees
The people (a minimum of 2) responsible for managing a trust on behalf of a beneficiary. In terms of a Will, normally the executors become trustees of any trust created by the Will. Trustees should be people you trust with knowledge of a beneficiary and the capability of managing the trust in accordance with very strict trustee rules. Trustees can be personally liable for mistakes made.
Witnesses
A Will must have two witnesses who verify the signature of the testator/testatrix. They must sign the Will in the presence of each other and the testator/testatrix. A beneficiary (or their spouse/civil partner) should not act as a witness to the Will as otherwise the gift to them or their spouse/civil partner will fail.
Will
A legal document stating what is to happen to your money and possessions after death. An Executor is normally appointed to deal with the administration of the estate.
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