Probate is the name given to the process of dealing with someone's money, possessions and final wishes after they die.
Probate is a court document called a Grant of Probate, which gives the court's authority to administer a deceased person’s estate. Without it, the deceased person’s estate is frozen and cannot be distributed to the beneficiaries. Only the funeral director’s account and inheritance tax can be paid without Probate being granted.
The Grant of Probate is normally issued to the executor(s) named in the Will, but if there is no Will it will be issued to a close relative. This document is sometimes called the Grant of Representation and is usually required by the asset holders, such as the banks, as proof to show the correct people have authority to deal with the estate. They will not release the assets to the executors until they have seen the Grant of Probate or Grant of Representation.
The executor has to do a full inventory of the deceased person’s assets and liabilities, fill in various forms and apply to the Probate Registry to get the Grant of Probate (from now on in this article called Probate.
In short, the executor has to deal with deceased person’s money, property and possessions (known as ‘the estate’) by collecting in all the assets in the estate, paying any debts and distributing what is left to those people entitled to it. Given the complexity of the process, it is sensible to use a family law solicitor who specialises in probate as the executor. It is also sensible to name the executor in your Will.
The executor will communicate closely and regularly with close family members of the deceased.
How do I get Probate or Letters of Administration?
The first job is to find out if the deceased person left a Will. If they did, the Will should nominate an executor(s), who are entitled to obtain Probate.
If there is no Will, a Grant of Letters of Administration is obtained instead of a Grant of Probate.
There is a proscribed list of who can apply for a Grant of Letters of Administration. The first person entitled is any surviving spouse, and then the issue (the children), followed by parents then siblings. They will be known as administrators.
The executors or Administrators need to find out exactly what assets and debts the deceased person had. These are typically:
- money in bank, building society or savings accounts;
- houses and land; businesses, or business assets, owned by the deceased;
- investments such as stocks and shares;
- personal belongings, including jewellery and antiques;
- furniture, fixtures and fittings in a house;
- motor vehicles;
- pensions that include a lump sum payment on death (as opposed to an on-going annuity to a surviving partner);
- assets in a trust from which the deceased benefited;
- payouts from life insurance policies;
- foreign assets held abroad including foreign bank accounts, property or shares.
Property such as furniture, clothing, jewellery and cars can normally be sold without the executor having to prove to the buyer that they are entitled to sell such items.
Once the executors or administrators are sure they have identified all the assets and liabilities they can apply for Grants of Probate or Letters of Administration.
How this is done will depend on whether there is inheritance tax (IHT) to pay on the estate.
You will almost certainly need a Grant of Letters of Administration if the estate includes:
- assets worth more than £15,000 in total;
- land or property in the sole name of the deceased, or held as ‘tenants in common’ with someone else. You can find out whether property is held as ‘tenants in common’ by looking at the deeds, though you may need help from a solicitor;
- stocks or shares;
- some insurance policies.
Probate isn't required when the value of the deceased person’s assets is under £15,000 or when the majority of the assets are held jointly, usually with the surviving partner, and the assets pass automatically to the surviving joint holder.
An Inheritance Tax (IHT) form has to be filled in even if the estate doesn’t owe Inheritance Tax. The estate will only owe Inheritance Tax if it's over the threshold, currently £325,000. On the death of the second spouse the threshold is £650,000 if the first spouse to die left everything to the survivor.
The Inheritance Tax forms needed depend on whether it is an 'excepted estate' (less than £325,000) or less than £1,000,000 because of spouse, civil partnership or charitable exemptions
If an estate has no Inheritance Tax to pay, it will be an excepted estate and the form to complete will be IHT 205.
If someone leaves all their estate to their surviving spouse there is no inheritance tax to pay so it is only necessary to complete form IHT 205. However, this is not always the case. Some estates that don't owe Inheritance Tax still require a full Inheritance Tax account. This form is called IHT 400 and is more complex.
Can I get Probate myself?
Yes, it is possible, and this is a useful website for advice.
However, bear in mind these issues when being the executor responsible for Probate:
- There is a lot of complex work involved, particularly where there are a number of assets or beneficiaries. The beneficiaries have to be written to several times and the forms have to be completed correctly;
- If there are trusts created in the will it is essential to either disband them correctly or ensure they are properly set up and registered with HMRC;
- If mistakes are made they will come to light later, usually after the second parent has died;
- There is potential for families to fall out at a time of loss and stress. Using an independent advisor can reduce disagreements and arguments between relatives;
- As an executor you will be personally responsible if something goes wrong. For example, if you find out after you have distributed the assets to beneficiaries that the deceased person still owes money, you may have to pay the creditors yourself. A solicitor can help to protect you from this personal liability;
- It is increasingly common for people to make claims against an estate under the Inheritance (Provision for Family and Dependants) Act 1975. For example, someone who was financially dependent on the deceased during their lifetime, or a cohabitee of the deceased person can make a claim. Using a solicitor will help protect you against personal liability if someone comes forward with a claim.
If you do it without a solicitor you will have to fill in an extra form, pay a fee of £215 and attend an interview/appointment at a Probate Registry. There is usually a delay of a few weeks before you get an appointment, so the process will be slowed.
The official fee if you use a solicitor is £155 plus 50p for each additional sealed copy of the Grant of Probate or Grant of Letters of Administration. If you decide not to go through a solicitor, the charge for application is £215 - this breaks down as £155 application fee, plus £60 personal application fee.
Many solicitors will complete the IHT form for you and submit it to the Probate Registry, but you can do all the other work involved in winding up the estate and distributing the assets. The fee the solicitor charges in this case should be relatively modest.
However, there is no obligation to use the solicitor who drew up the Will and is holding it in their firm’s safe. Even if the solicitor is named as the executor in the Will you can ask them to sign a Deed of Renunciation if you do not want them to act as executor.
If you decide to use another solicitor or advisor, talk to the person who will be doing the work to satisfy yourself that they are competent and you will have a good relationship with them over the next few months. You should also ask them for a quote and be satisfied it is reasonable by comparing with other firms’ quotes.
How long will it take?
The length of time to administer an estate depends entirely upon the size of the estate, and the nature of the assets held by the deceased.
Probate takes an average of three to four months if no inheritance tax is payable and between five to nine months if inheritance tax is payable.
Claims can be made against the estate under the Inheritance (Provision for Family and Dependants) Act 1975 within six months from the date of the Grant of Probate or Grant of Letters of Administration, so the executor may wish to delay distributing the estate.
If you would like to discuss your situation or options regarding a probate application you can find a solicitor through The Law Society.