Probate is the legal and financial process of closing down an estate (house, savings, investments, personal belongings) after someone has died, and distributing them in accordance with the wishes in that person’s Will. The word Probate means to ‘prove’ the Will by establishing its validity, making certain it is the Last Will and Testament of the person who has died. This must be done via the Probate Registry which is the court process in England and Wales.
Read our useful tips below to find out whether you need probate, when probate is required, what the probate process involves, and instances of probate without a will.
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Before the Executors named in the Will can distribute any of the deceased persons assets, they must apply to the Probate Registry Court for a Grant of Probate. This is a legal document, giving the Executor the right to sell, cash in or transfer assets to the beneficiaries (people who are going to inherit). If the person died intestate (without leaving a Will), the next of kin will need to apply for Letters of Administration before they can start distributing assets. The Estate will be distributed in accordance with the Rules of Intestacy, meaning the law will decide who gets what and the money may not end up where the deceased intended.
If the deceased owned any property, probate will be required. If the deceased had savings over £15,000, the same applies – however it is worth checking with each bank and building society as they all have their own thresholds and will sometimes release cash without the need for Grant of Probate.
There are several stages involved in closing down an estate. This process involves assessing tax liabilities and selling or cashing in financial assets such as stocks, shares, ISAs etc. Here is a simplified version of what an Executor needs to do:
Compile a detailed list of the deceased person’s assets (property, investments, belongings) and liabilities (debts, outstanding utility bills), to work out the value of the estate.
Pay all outstanding Inheritance Tax to HMRC;
Submit a tax return to HMRC, regardless of whether there is tax due or not;
Pay the court application fees and apply for Grant of Probate.
Once Grant of Probate has been issued, all assets need to be liquidated (cashed in and sold);
Pay all liabilities (debts);
Pay any further Inheritance, Income or Capital Gains Tax due to HMRC.
Prepare Estate accounts showing all payments collected and made by the Executors and the balance due to the beneficiaries;
Sending the accounts to the beneficiaries for approval.
Providing no-one has challenged the Estate, pass assets across to the beneficiaries that they wish to keep;
Distribute money in accordance with the wishes in the Will.
When someone dies without leaving a Will, it is called ‘dying intestate’. The Rules of Intestacy (law as to what happens) are very clear in the UK. Put simply, the courts will decide who gets everything from your pets to your home and money. Intestacy Rules do not allow for modern and often blended families, meaning unmarried partners can end up with nothing, as can step children. As the Intestacy Rules will decide who inherits, a detailed family tree needs to be put together, which can often be a complicated process. If mistakes are made, Estate Administrators can be held personally liable, regardless of whether the mistake was a genuine error.
If you are an Executor who needs to deal with a Will or the next of kin of someone who has died without a Will, we can provide a fixed fee service to deal with Probate on your behalf. Our service provider will speak to HMRC, liquidate any assets, pay all outstanding debts and distribute the assets in accordance with the Will or the Rules of Intestacy.
Probate Administration in England and Wales is not a regulated activity, meaning unregulated providers can offer Probate Estate Administration Services, regardless of whether they are qualified or insured to do so. TLB Planning Ltd only use experienced, qualified and regulated providers to manage their clients Probate Administration needs, giving you the peace of mind that the deceased person’s affairs are being correctly and legally managed.