PROBATE AND LETTERS OF ADMINISTRATION
Initial Steps
When someone passes away, we are happy to offer a free initial meeting to explain the process and to offer as much or as little assistance as may be required. There is no obligation to use our firm thereafter, although we of course would hope that you would consider doing so.
During the initial meeting, we identify matters that will need to be dealt with, review the will or the intestacy rules if no will was made and explain how the estate will need to be distributed. We also aim to flag up any pressing matters that will need to be dealt with, such as the property insurance to ensure the executors are suitably protected.
We ensure that the family are aware that the funeral is the first charge against any estate and that banks are therefore generally happy to pay this from the deceased’s own bank accounts – to save them having to pay for this from their own funds.
Where a will cannot be found, we can arrange a search of the national will register. We also discuss a number of steps that can be taken to protect the personal representatives, such as placing adverts for creditors, carrying out bankruptcy searches before distributing and ensuring that assets are not mixed with their own as part of the administration process.
The inheritance tax position is reviewed and based on any initial figures provided, we can give a rough indication of the amount that will be payable and the type of inheritance tax form that will need to be completed. We consider any exemptions that may apply and allowances that should be claimed, such as the transferable nil rate bands and residence nil rate bands and we explain what documentation will be required to claim each of these.
It is also important to consider lifetime gifts made by the deceased at this initial meeting, since these may well have a bearing on the inheritance tax account.
We always quote consistently and fairly and are generally able to provide an accurate quote either during this initial meeting, or shortly thereafter where there is insufficient information to enable us to provide a quote at the meeting itself. Our fees are normally paid from monies collected in during the course of the administration, so there is normally no need for the family to pay us directly.
Deeds of variation are also considered. These offer a tax efficient way for beneficiaries to vary their personal inheritance if they are looking to make gifts to their children or others of their choosing at within two years of the date of death.
To arrange a no obligation and free initial discussion please call either our Reading Office on 0118 957 4424 or our Bracknell Office on 01344 53 4424. Alternatively email sols@ejwinter.co.uk or click contact us now.
Collecting information
Should you choose to instruct E J Winter to assist with the administration, we will write to each of the financial institutions as soon as possible after the initial meeting, to register the death and to request all the information needed to complete the inheritance tax account. At the same time, we request closure forms to make sure we are ready to close the accounts as soon as we are in a position to do so.
We also request details of income paid, where relevant, to enable us to properly deal with the deceased’s income tax position.
Where the deceased had liabilities, we establish the amount owing and check whether any insurances were in place, such as PPI which may pay any such balances.
application
Once we have established all asset and liability values as at the date of death, we can begin the process of completing the inheritance tax account and the application for probate or letters of administration.
Some clients may instruct us to proceed on an application only basis, where the only area we assist with is the completion of the inheritance tax account and the preparation and submission of the probate application. We can assist on this basis for a fixed fee as detailed in our schedule of fees.
Where the estate is taxable (or non-taxable but still requires a full account), we order the inheritance tax reference number (where necessary) and submit a detailed account to HMRC in Nottingham at the same time as paying any tax due, either in full or in instalments. Once HMRC is satisfied with the account and payment has been received, they will issue the probate summary, which enables us to apply to the probate registry for the grant.
For non-taxable estates we can complete a short form inheritance tax account which can be lodged directly with the probate registry, rather than initially having to deal with HMRC. Applications are now generally made online and we have an HMCTS online account to enable us to process these efficiently before submitting any original papers to the registry.
The online process has considerably speeded up the application process, which struggled significantly during the Covid-19 pandemic – which coincided with proposed changes to the Stamp Duty.
COLLECTING IN ASSETS & PAYING LIABILITIES
After we have applied for probate or the grant of letters of administration, the sealed grant is normally issued by the probate registry in a few weeks. The grant, is simply a court sealed sheet of paper confirming that the personal representatives are entitled to deal with the administration of the estate and to collect in and sell assets.
We are able to collect funds into our client account, which saves the personal representatives from having to open a specific executors account. Assets should never be mixed with the personal representative’s own funds.
We initially use the monies collected in to pay the estate’s creditors, such as the balance of the inheritance tax account where this was initially paid in instalments, any mortgage or equity release secured on the property, loans and credit card liabilities.
To arrange a no obligation and free initial discussion please call either our Reading Office on 0118 957 4424 or our Bracknell Office on 01344 53 4424. Alternatively email sols@ejwinter.co.uk or click contact us now.
ESTATE ACCOUNTS
We prepare a detailed set of estate accounts, itemising all assets and liabilities as at the date of death and every capital asset or liability, income paid and gains made between the date of death and the date of closure or disposal. This enables us to complete a corrective inheritance tax account where required and provides you with an accurate picture of the estate, accounting for every penny.
Once the estate accounts have been approved, we can then look to issue distributions. It is advisable not to distribute until at least 6 months have passed after receiving the grant of probate or letters of administration. This is because there is a 6 month time limit for family members or dependents to make a claim against the estate. Waiting for this time-period to expire protects the personal representatives from claims being made against them personally, rather than against the estate.
DISTRIBUTION
Once the accounts are approved by the personal representatives, all creditors are paid, clearance is received from HMRC (where required), income tax and any capital gains are paid and the time limit for bringing claims against the estate has passed, we can look to distribute the estate, starting with specific cash gifts and followed by distribution of the residuary estate.
We always run a bankruptcy search against each beneficiary before transferring monies to them, once more to protect the personal representatives from accidentally distributing to an executor who was subject to an IVA or bankruptcy proceedings and who therefore should not have been paid monies directly.
To arrange a no obligation and free initial discussion please call either our Reading Office on 0118 957 4424 or our Bracknell Office on 01344 53 4424. Alternatively email sols@ejwinter.co.uk or click contact us now.
To arrange an appointment to discuss the administration of a loved ones estate or any issues raised here, click below.
WILLS, PROBATE & POWERS OF ATTORNEY TEAM
