Prior to the deceased’s death they may have written a Will which sets out their wishes on the disposal of their assets. If this is the case, careful consideration will need to be made of this document to determine the names of the executors and beneficiaries. Depending upon the extent of the deceased’s finances it may be necessary to obtain a Grant of Probate before the estate can be distributed.
The first thing we do upon being appointed is to determine the assets and liabilities of the Estate, their location and whether there are sufficient assets to cover all the liabilities of the Estate, including the funeral costs. To do this we will write to all the Banks and other financial institutions to establish the balance at the date of death and the current balances. Once these institutions are notified all monies will be frozen and no further withdrawals will be permitted. However, if the balance is sufficient, Banks will usually agree to pay the funeral account but this money will be paid direct to the company.
Real Property (Land) If the deceased left a property we will obtain an open market valuation, i.e. the figure the property is likely to fetch if sold on the open market. Failure to determine the correct valuation may result in a tax investigation, fines and further tax penalties. We do not generally rely on an Estate Agent’s valuation which may be open to challenge by HM Revenue and Customs. A property cannot be sold until Probate has been granted which might take several months to obtain. We also require an open market valuation on all furniture, furnishings, jewellery and home contents which might have a value. We usually instruct a local auctioneer to do this.
Beneficiaries Normally, early on in the process we will notify all beneficiaries by supplying a copy of the Will. As part of this process we will require each beneficiary to prove their identify to comply with money laundering regulations.
Tax Once we establish there are sufficient assets, we will be able to determine if any inheritance tax is due.
Once we are in a position to determine the size of the Estate we will send a completed copy of the relevant tax form to the executors with a full explanation of the assets and liabilities. The executors will be asked to sign the tax form if they are satisfied it is true and accurate. Failure to provide the correct information can result in the executors being held personally liable with the risk of criminal and civil penalties including fines and additional tax. In severe cases imprisonment may be imposed.
If any tax is due it has to be paid prior to the application to the Probate Registry. Banks will normally release funds to pay the tax, provided that it is paid direct to HM Revenue and Customs. Once the tax has been paid we will receive a certificate which will prove to the Probate Registry this has been completed. In some cases not all the tax has to be paid immediately, but can be paid in yearly instalments (subject to certain conditions).
Executors Oath Once the tax form has been submitted to HM Revenue and Customs and the tax has been paid we will prepare an Oath which the executors will be required to swear before an independent solicitor. The oath sets out the name, address and age of the deceased, that the Will is the final and last one made by the deceased and the size of the Estate.
If no tax is payable we will prepare the Executors oath as above.
Application to Probate Registry Once signed, the oath and tax forms are sent to the Probate Registry along with the fee. If the Probate Registry is satisfied with the documentation it will make an order by placing a seal on the document which states the name, date of death and the names of the executors (this is called the Grant of Probate). We will then write to the financial institutions and provide them with a Grant of Probate and a written request signed by the executors to close the accounts and forward the monies to us.
We will then carry out all the other work necessary to administer the estate.
This article is for guidance purposes only and is no substitute for specific legal advice about you personally and we will not be liable to you if you rely on this article. Although we have made every effort to provide accurate information, the law is always changing and affects each person differently