Why do I need probate?
After someone has died, it will be necessary for their estate to be administered. If the deceased has made a Will, it should state who they want to deal with their affairs. The person or people identified in a Will as the person to administer the estate is known as the Executor(s).
What is probate?
A Grant of Probate is a document issued by the Probate Registry to the Executors, confirming that they have the authority to deal with the person’s estate. The Executors can use this to collect in the assets, sell any assets and collect in the sale proceeds, pay the liabilities and distribute the remainder of the estate in accordance with the person’s wishes as expressed in their Will.
In the period between death and receipt of the Grant of Probate (the Grant), the Executor has limited powers to deal with the assets and certain transactions, such as the sale of land or withdrawing large sums from bank accounts, will not be possible without the Grant.
Do I always need probate?
Whilst the Grant gives the Executors authority to deal with the estate, it is not always required. There are certain scenarios where the estate can be administered without a Grant. These include:
- Assets which can pass to the Executors without a Grant, including cash (coins and notes), furniture, cars and jewellery, as these sorts of assets do not require proof of ownership.
- Jointly owned property. Joint bank accounts or property owned as “joint tenants” will automatically pass to the other joint owner. It is sensible however, to update the property title (for example, by notifying the bank so that the name of the deceased is removed from the account).
- Small bank account balances. It is usual that banks or building societies which hold only small sums of money (even in the sole name of the deceased) are prepared to release the funds without sight of a Grant. However, the amount can vary between organisations so is something that must be checked with each of them directly.
- Other benefits, such as death in service benefits as part of a pension scheme or a life insurance policy held on trust for others. These typically do not form part of the estate so a Grant is not required.
How do I apply for probate?
Before making an application, the Executors must prepare an estimate of the value of the estate for the purposes of inheritance tax. If inheritance tax is payable this takes the form of a full Inheritance Tax return and the tax itself is due 6 months from the date of death. Inheritance tax must be paid (although sometimes only in part) before the Grant can be issued. Often formal valuations of key assets such as houses and land, business interests or share portfolios must be obtained.
There is a fee of £273. The Executors can make a personal Grant of Probate application or instruct a solicitor to apply on their behalf.
Should I instruct a solicitor?
A solicitor can help guide an Executor through the process of accurate tax reporting, applying for the Grant and then collecting in the assets, paying the liabilities and administering the estate in accordance with the Will.
The Executor is legally and financially responsible for administering the estate. This means they take on a number of personal risks. If a debt is overlooked or inheritance tax miscalculated, the Executor will be personally liable to pay this. Even estates which seem straightforward at first can prove to be more complex than initially thought, so expert advice can be vital in ensuring the Executor is protected.
A solicitor can also deal with any claims made against the estate from someone who feels they have been unfairly treated under the Will or by the intestacy rules. A solicitor can advise you on the likelihood of any claim and assist you if a notice is served.
A solicitor with experience in probate will ensure the administration of an estate is conducted correctly and as efficiently as possible.
What if there is no Will?
If the deceased has not made a Will, the intestacy rules dictate who is entitled to administer an estate. They are known as ‘Administrators’.
The application to the Probate Registry is for a Grant of Letters of Administration. The application process is similar to that for Probate, though it is slightly more complex.
There are limits upon who can apply for a Grant of Letters of Administration, and therefore act as an Administrator. There is a strict order of preference which sets out who may make the application. A person may only apply if there is no one in a category above them who is able and willing to do so. An application must state why anyone in a higher category has not applied, this is known as ‘clearing off’.
The Administrators’ powers come from the Grant itself, unlike Executors who get their powers from the Will. This means that Administrators are unable to exercise almost any powers prior to the Grant being made.
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