Estate Administration (Probate)
Wills outline the distribution of estates after death, but in the absence of a Will, estates are subject to the Law of Intestacy. In such cases, families may require guidance to comprehend the inheritance structure. For instance, if a surviving spouse or civil partner exists, it doesn’t guarantee the entire estate will be automatically passed to them.
Arlingsworth’s team of private client lawyers provides comprehensive guidance and support across an array of tasks such as applying for letters of administration or a grant of probate, property transfers, handling insurance policies, asset liquidation, beneficiary tracking, and dealing with HM Revenue & Customs. The associated paperwork can be overwhelming, and the process can be exceedingly time-consuming. We are here to assist, offering support throughout the entire process or specific stages. Additionally, we may identify opportunities for post-death tax planning that could benefit the succeeding generation. Our lawyers are often regularly instructed to handle complex and high-value death estates.
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What is probate?
When a person dies having made a valid Will that appoints an executor(s), that executor(s) has immediate authority to administer the estate and the right to apply for a grant of probate in the deceased person’s estate of required. The grant of probate is the document that the various Financial Authorities and institutions will accept as proof of the executor’s authority to collect in and deal with the assets. e.g., most bank accounts or investments worth over £50,000 require a grant to close them It is also required for a sale or transfer of a property.
What is a letters of administration?
When a person dies without a valid Will or the executor who is appointed under a valid Will cannot act for any reason, a grant of letters of administration is required to appoint an administrator of the estate. In practise this is very similar to a grant of probate, but the key differences are that only certain people related to the deceased can apply, and the appointed administrator only has authority to act in the administration of the estate once the grant of letters of administration is issued.
How long does it take to obtain probate?
Before lodging the probate application, it is necessary to assess the estate’s value and, if applicable, submit an Inheritance Tax (IHT) account to HMRC. The duration of this process depends on the estate’s complexity and the available information. A Missing Asset search should be commissioned. Once the IHT status is determined, and either an initial instalment or the complete amount is remitted to HMRC, the probate or letters of administration application can be applied, taking approximately 2-4 months.
Both probate and letters of administration applications are submitted to the Probate Registry. Despite recent reforms enabling some online applications, certain submissions still require a traditional paper postal application. The Probate Registry has experienced significant delays post-pandemic, and though improvements are evident, some applications surpass official estimates. Online applications typically result in grants within 6-8 weeks, while postal applications may incur wait times of 8 to 16 weeks. Despite efforts, delays persist for various reasons, necessitating extensive communication with the Probate Registry for issue resolution.
Engaging a solicitor in the application process proves beneficial during delays, given their familiarity with procedures, often expediting the process. Additionally, solicitors can mitigate the risk of delays by ensuring all requisite information is accurately submitted to the Probate Registry from the outset.
What happens once probate is granted?
Upon obtaining the grant, the executor or administrator gains the authority to commence estate administration and distribution. This entails the collection of assets and settlement of any outstanding estate debts. In cases where only an initial Inheritance Tax (IHT) instalment was paid pending property sale, the remaining IHT amount becomes due immediately upon the sale of property.
During the administration period, the executor or administrator must assess the Income Tax and Capital Gains Tax status of the estate. If there is income, such as rental or interest, HMRC may require an account submission. Similarly, if an asset sells for more than the probate-submitted value, an account must be submitted to HMRC.
Upon resolving the estate’s tax status, settling all debts, and collecting all assets, the executor or administrator proceeds to distribute the estate in accordance with the terms of the Will, or intestacy rules in the absence of a Will.
It is advisable to await the expiration of the deadline for potential beneficiary and creditor claims before distributing the estate. Executors and administrators can request Estate Accounts to be prepared and endorsed by beneficiaries before any distribution, offering a protective measure in the event of disputes arising during estate administration.
What happens if there is a dispute (contentious probate)?
Inevitably disputes can and do happen when it comes to the administration of estates. Some individuals may feel they have not been fairly provided for by the deceased and make steps to try and dispute the terms of the deceased’s Will. Others may have concerns about the deceased’s testamentary capacity or the involvement of third parties in the creation of a Will, and may try to challenge the Will on validity grounds. Whatever the circumstances, taking expert legal advice from one of our solicitors in early course is imperative. For contentious probate work, please refer to our litigation page.
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