Probate – where to start

Due to the Covid-19 pandemic and the restrictions on people movements and gatherings, we are seeing an increase in questions around the probate process and we are here to help steer you through it and to make it as easy as possible.

Probate is not simply a case of reading through the Will and handing assets out to their rightful beneficiaries.

For estates worth more than £5,000, unless all assets were held in joint names and are passing to the surviving spouse or civil partner, estate executors may need a grant of representation before banks and financial institutions will allow access the deceased’s assets. Some financial institutions will release sums up to £50,000 without probate. It can however be a long and tedious process and estate executors must make sure that they follow the official procedure.

Before the estate can be valued all assets will need to be identified including bank accounts, vehicles, pensions, life insurance policies and any other belongings of value. Any property owned by the deceased will need to be valued by an Estate Agent or valuer and all financial assets, such as savings and investments, will need to be given a valuation on the date of death.

This will be difficult to do in person whilst there is a lockdown in place, however you might be able to find agents or valuers who can give you the information you need via other means.

You will also need to consider insurance for properties left empty at this time and the safe keeping of valuables until they are distributed or sold, especially if you are unable to attend to these matters in person. Items such as firearms can only be handled by someone with an appropriate licence and you may need to arrange for the removal, handling and safe keeping of guns at this time by a licensed third party.

Mortgages, credit cards, loans and personal debts, and funeral expenses will also need to be accounted for as these will all need to be settled out of the deceased’s estate before any assets can be passed to the beneficiaries. Because of the restrictions on gatherings at this time, many people may choose to honour the memory of their loved one at a later date once restrictions are relaxed, so the cost of doing this will also need to be taken into account.

Once the total worth of the estate has been calculated, Inheritance Tax forms will need to be completed. There is no application fee if the estate is worth less than £5,000 and for estates worth £5,000 or more it costs £215.

Forms need to be completed even if the estate value falls under the £325,000 threshold, and there is no tax owed. You can pass on a home to your husband, wife or civil partner when you die and there is no Inheritance to pay in this situation.

If you own your home or a share in it, your tax-free threshold can increase to £500,000 if you leave it to your children or grandchildren and if your estate is worth less than £2 million. For estates where the value is less than twice the Inheritance Tax threshold and where 100 percent of unused Inheritance Tax from a late spouse or civil partner can be transferred to the deceased, only a Return of Estate Information form will need to be completed.

Completed forms will need to go to the Probate Registry and HMRC, the estate executor will then have to pay any Inheritance Tax and also swear an oath before they are issued with a grant of representation and the assets can be released.

Being an estate executor is no simple task. Getting access to the assets can be time consuming, especially if the deceased did not keep sufficient records. But this is only the first hurdle and estate executors must go on to divide the assets amongst beneficiaries. Another lengthy task that can be further complicated by complex family situations and potential Will disputes.

For advice on the Probate process, estate administration and Inheritance Tax, Alexander Astley can be reached at a.astley@gullands.com or 01622 689700 or visit www.gullands.com