1. Practical Arrangements
When a loved one passes, there will be a number of practical arrangements to consider, including registering their death, arranging the funeral and letting others know of their passing.
It will also be important to trace the last Will and Testament, if there is one, which will appoint executor/s of the deceased’s estate. Usually, the deceased will appoint a family member or close relative or someone else they trust.
Sometimes this role can be an added pressure or too onerous at such a sensitive time. Executors who would like to continue in their role and have control of the estate, but don’t have the practical means to administer the estate, can choose to appoint a solicitor who can help with the remaining steps. Executors whose preference or circumstances mean they would not like to continue in the role may ‘renounce’, but must choose to do this before they have ‘intermeddled’ in the estate.
If your loved one didn't leave a Will but you’d still like to help sort out the estate, it will still be possible to apply to the Probate Court to become an administrator, dealt with in a later step.
2. Value the Estate
During the process, the executor or administrator will need to value the estate in terms of any assets, including relevant lifetime gifts, less any debts. An evaluation is needed to calculate any inheritance tax (IHT), Capital Gains Tax (CGT), debt settlement, and the net value of the estate. It is good practice to discharge your duty as an executor or administrator to place a deceased estates notice in The Gazette, which will help offer protection against any claims. Placing this notice helps to show that you’ve taken reasonable steps to locate creditors (people who are owed money from the estate) before you look to distribute the estate to any beneficiaries.
Consider a financial asset search
During the process, it may be worth undertaking a financial asset search to check for any dormant, lost or unknown accounts. In the UK, there is an estimated £200 billion in dormant accounts held by financial institutions.[1] This figure is increasing year on year as executors are not aware of bank accounts and pension pots that have been ‘lost’ over the years. As people change jobs over their careers, they may have left behind pension funds held by previous employers. Doing a complete asset search will help to uncover anything not readily accounted for and will help executors and administrators to discharge their duty to search for assets.
3. Pay Inheritance Tax
Inheritance tax (IHT) is the tax on the deceased's estate. Its value depends on the assets' worth and to whom the deceased person left the estate, given there are some exemptions for relatives to accumulate the tax-free threshold. The standard IHT rate is currently 40%, which is charged on the estate that is above the threshold amount. This amount can vary depending on the deceased’s personal circumstances and type of assets in the estate.
4. Apply for appointment by the Probate Court
In order to have authority to act on behalf of the deceased, you will need to apply for a Grant of Probate, also known as a Grant of Representation. This will appoint you as either the executor or administrator (if the deceased did not leave a Will). This official document is issued by the Probate Court and comprises the deceased's information, the executor's or administrator’s information, the date of the Will (if there is one), and the gross and net values of the deceased's assets.
5. Collect in assets
Once the Grant has been issued, it is up to the executor or administrator to collect in the assets, including investments, money due or possessions, and sell or transfer property.
6. Estate accounts and final distribution
It is the responsibility of the executor or administrator to show a final account, which details monies incoming and outgoing from the estate. This should include all assets, debts, administration costs and the amount that must be distributed to all beneficiaries. All monies should be distributed to the beneficiaries according to the Will, if there is one, or in line with the intestacy rules.
Make probate easier – contact QualitySolicitors Hopleys GMA
The process can be difficult and time-consuming depending on the complexity of the estate. After the loss of a relative or close friend, it can be challenging to deal with. Considering all the steps involved, you can streamline the probate process by recruiting the help of our experienced probate solicitors.
To contact our estate administration specialists, please phone us at our Wrexham (01978 291 322) or Mold (01352 753 882) offices.
[1] Harry Brennan, ‘There's £200bn in lost wealth waiting to be found – here’s how to track it down’, The Telegraph (20 March 2019) https://www.telegraph.co.uk/money/consumer-affairs/200bn-lost-wealth-waiting-found-track/