When someone close to you dies you may have to tidy up their legal and financial affairs and distribute their assets to their heirs. To do this you will need to obtain Grant of Probate.
What is Grant of Probate?
In England, Wales and Northern Ireland, this is the process of getting legal authority to administer the estate of someone who has died.
Why obtain Grant of Probate?
In most cases you will need to obtain a Grant of Probate to act as the executor of someone’s estate. However if the estate is worth less than £5,000, or if the deceased owned everything jointly with someone else (as the ownership will automatically be transferred to them on death) a Grant will not be necessary. Some banks will allow accounts of more than £5,000 to be closed without a Grant (each have different limits).
You can obtain Grant of Probate if the deceased left a Will and they specified you as an Executor. An Executor’s job is to share out the estate as stipulated by the deceased as well as carry out any final wishes in the Will.
If there is no valid Executor named (for example if they have died), or there is no Will, someone must then become the Administrator of the estate.
How to apply for a Grant of Probate
– Register the death
If it has not already been done you will need to register the death. This must be completed within 5 days in England, Wales and Northern Ireland.
Always buy extra copies of the death certificate at this stage as you will need to send them off to all the institutions you will inform of the death. You will not be able to use your own photocopies. It is quicker and cheaper to buy them when registering the death than to order extra official copies later.
– Value the estate
To apply for Grant of Probate you will have to value the size of their estate. To do this you will need to go through the deceased’s personal information to establish their assets and liabilities.
For most estates this is straightforward, but it can become complex if the deceased had multiple investments, properties, overseas assets and personal belongings.
To establish the asset and liability values you will need to contact:
- Banks – for cash assets and accounts
- Lenders – for mortgages, credit cards and loans
- Fund managers/Stockbrokers – for shares, bonds and other investments
- Pension providers – both private providers and the DWP for state pensions
- Government departments – for personal tax, council tax, fines etc
- Check for any outstanding payments – tax, utilities, rent, other bills (e.g. funeral) etc.
– Property valuation
Estates very often include a property, which will also need to be valued. This can usually be done by obtaining valuations from 2 or more reputable local estate agents. You can look at comparable local home sales to value the property, however, if inheritance tax is likely to be an issue a written valuation by an estate agent or surveyor will make dealing with HMRC less complicated.
If the deceased has any valuable collectables if is best to have them valued by a professional for the same reason.
Currently the basic Inheritance Tax (“IHT”) threshold, or “nil-rate band”, is £325,000 of net assets. If the estate is valued below this amount then there will not usually be any Inheritance Tax payable. There may be other tax reliefs available depending on the deceased’s circumstances.
– Once you have gathered all the deceased information you will need to:
- Complete and file Inheritance Tax forms
- File Probate forms
- Pay Probate fees – currently £215 in England and Wales regardless of the size of estate, or £155 if you apply through a solicitor
- Pay Inheritance Tax – this must be paid in advance, however there are ways to manage this
- Avoid unwanted stress – place a deceased estate notice so you are not personally held liable for any of the estate’s unidentified debts
Administering the Estate
Once Grant of Probate has been obtained, you can begin the process of gathering in the assets, paying the liabilities and distributing the balance of the estate to the beneficiaries. This is known as Estate Administration and is often the greater part of the work required.
How Backhouse Solicitors can help
The death of a loved one is always an emotional and stressful time. Being the executor or administrator of their estate only adds to the pressure, which is why so many people ask a professional for help.
At Backhouse Solicitors we understand exactly what you need, and our team of Probate experts are here to guide you through the process. We will give you as little or as much help as you require, whether it’s a small bit of advice or simply taking all of the stress away and dealing with the Grant and Administration for you.