Probate is officially the legal right to deal with someone’s property, money and possessions (their estate) when they die.
However, the term has become synonymous with the entire process involved in managing a deceased person’s estate (estate administration) and therefore the term is now used almost interchangeably.
The estate administration process can be complicated, and many people encounter difficulties when trying to manage their loved one’s affairs.
If the deceased left a Will, it should include the name of an ‘executor’ who is the person (or people) they wish to administer their estate. If there is no Will (an intestate estate), an ‘administrator’ will be appointed following the rules of intestacy to undertake the estate administration process.
Executors and administrators are collectively known as ‘personal representatives’ (PRs).
PRs must follow a strict legal process when administering an estate and may be personally liable for any mistakes they make.
If you have been named as an executor in a Will or if a loved one has died without a Will, our specialist probate and estate administration team can help.
We will guide you through the entire estate administration process, helping you navigate your obligations at this difficult time.
For more information on probate and wider estate administration, please call 020 8852 4433 or email privateclient@beverleymorris.co.uk.
In this blog, our experienced Probate Solicitors in Blackheath consider the main stages involved in estate administration.
Main Stages of Probate
Although every estate is different, the steps involved in probate can be broken down as follows:
Step one: Identifying the deceased’s assets and any liabilities.
After registering the death and in some cases also dealing with the funeral arrangements, an executor’s or administrator’s next job is to value the deceased’s estate.
This involves first identifying the assets that comprised the estate (cash, property, personal possessions) along with any liabilities such as mortgages, loans or outstanding bills.
PRs must also establish if any gifts were made during the last seven years of the deceased’s lifetime and locate any interests in any Trusts.
Step two: Valuing the deceased’s assets.
Once the PRs have established the various assets that comprised the deceased’s estate, they then need to assess their total value.
This may involve instructing specialist valuers, depending on the assets.
Having a clear and accurate understanding of what an estate is worth is essential before applying for a grant of probate (or ‘letters of administration’ for an intestate estate) in order to protect an executor or administrator against any possible future claim.
Step three: Preparing the inheritance tax (IHT) return.
PRs must report the value of the estate to HMRC by completing Form IHT400 which must be submitted within 12 months of the person dying.
The IHT400 Form is used to calculate the amount of inheritance tax that is due on the estate.
IHT is charged at 40% on the estate of someone who has died, above a £325,000 threshold.
NB There are circumstances where the £325,000 threshold is increased to a higher figure.
Step four: Submitting the IHT return and paying any tax due.
If IHT is due, it must be paid before an application for the grant of probate/letters of administration can be made.
Usually, the tax can be paid directly from one of the deceased’s bank accounts, or in instalments.
Any IHT due must be paid by the end of the sixth month after the person’s death, otherwise HMRC will start to charge interest.
Your solicitor will advise you on what your options are.
Step five: Making the application to the Probate Registry for a grant of probate/letters of administration.
Once a PR has made a payment towards any IHT due, they can then apply for a grant of probate/ letters of administration that will give them the legal authority to distribute the estate.
This application will usually take about 16 weeks although it can take longer depending on the circumstances.
Step six: Distributing the estate.
Once all outstanding debts have been settled, the PRs can then distribute the assets to the beneficiaries as set out in the deceased’s Will or according to the law of intestacy.
Probate Solicitors Blackheath
At Beverley Morris & Co., we understand that losing a loved one is a very difficult time. In addition to your having to manage grief, there is the practical administration of a loved one’s affairs which for many can seem like a daunting prospect.
Our Probate Solicitors in Blackheath have been providing probate and estate administration services throughout London and the South East for many years.
Our local, sensitive and approachable team is on hand to help make the process as stress free as possible.
Our estate administration service includes legal advice on:
- Collating assets and arranging valuations.
- Calculation and payment of inheritance tax.
- Obtaining a grant of probate.
- Payment of debts and expenses.
- Distribution of the estate to the beneficiaries.
- Calculation of income tax and capital gains tax (CGT) and correspondence with HM Revenue & Customs.
For more information on probate and the wider estate administration process, please call 020 8852 4433 or email privateclient@beverleymorris.co.uk.
Find out more here.