Tuesday, January 28, 2025
Preparation for Probate
Words in Italics are from using Chat GPT
Link to 8 minute Video on PROBATE. 17.2.25 Morning Live
Instruction
Taking initial instructions;
Solicitor:
Completing the due diligence process
The due diligence process for preparing an application for probate involves several key steps to ensure that the estate of the deceased is properly managed and administered.
A general guide
1. Locate the Will (if one exists)
Search for the deceased original will and ensure it is valid (properly signed and witnessed).
If there is no will, the estate will be handled under the rules of intestacy.
2. Identify the Executors
Executors: Name and Contact Numbers.
Check the will to see who has been appointed as the executors. They are responsible for applying for probate.
If the executor cannot or will not act, another person may need to apply.
3. Checking the Validity of a Will
Before an executor can administer an estate, they must ensure the will is legally valid. A valid will must meet certain legal requirements under the Wills Act 1837.
Key Steps to Check a Wills Validity
1. Confirm It Meets Legal Requirements
A valid will must:
Be in writing (handwritten or typed).
Be signed by the person making the will (the testator).
Be witnessed by two people (who must also sign in the testator’s presence).
Be made by a person aged 18 or over who is of sound mind (has mental capacity).
2. Check for Signs of Tampering
Ensure no pages are missing or altered.
Look for multiple versions only the most recent will (with a date) is valid.
If the will has staple marks, clips, or amendments, this could indicate tampering or an attempt to replace pages.
3. Confirm the Testator Had Mental Capacity
A will is only valid if the person making it had testamentary capacity, meaning they:
Understood they were making a will.
Knew what assets they had.
Understood who they were leaving their assets to.
Were not suffering from a condition affecting their decision-making (e.g., dementia).
If capacity is in doubt, medical evidence may be needed.
4. Check for Undue Influence or Fraud
A will is invalid if the testator was pressured into making it. Warning signs include:
Sudden, unexpected changes benefiting one person.
The will was written by someone who also benefits from it.
The testator was isolated from family and controlled by another person.
5. Ensure the Will Hasn’t Been Revoked
A will is automatically revoked if:
The testator made a new will (the latest one applies).
They married or entered a civil partnership after making the will (unless it was made in contemplation of marriage).
The testator physically destroyed the will (e.g., tearing or burning it) with the intent of revoking it.
6. Confirm the Executor’s Authority
The will must name an executor to manage the estate. If the executor has died or refuses to act, an alternative executor or administrator must be appointed.
What If the Will Is Invalid?
If no valid will exists, the estate follows intestacy rules (assets are distributed to relatives in a set order).
If the will is partially invalid, only the valid parts apply, and the rest is handled under intestacy.
A court may be required to resolve disputes or challenges to the will.
Registering the death;
Registering a Death in the UK
When someone dies, their death must be registered within 5 days (8 days in Scotland) unless a coroner is involved. This is a legal requirement and must be done before funeral arrangements can proceed.
1. Who Can Register the Death?
The following people can register the death:
A close relative of the deceased.
Someone present at the death.
The executor or administrator of the estate.
A care home manager or hospital official if no family is available.
2. Where to Register the Death
The death should be registered at the local register office in the district where the person died.
If you cannot visit that office, you can register at a different office using the death declaration process, but this may cause delays.
You can find your local register office here.
3. Documents Needed
You will need:
The Medical Certificate of Cause of Death (MCCD) from a GP or hospital doctor.
If available, the deceased’s:
Birth certificate or driving license:
Marriage/civil partnership certificate (if applicable).
NHS number (found on medical letters or prescriptions).
4. Information Required
The registrar will ask for:
Full name of the deceased (including any previous names).
Date and place of birth.
Date and place of death.
Occupation (and if applicable, spouse/partner’s name and occupation).
Last known address.
Details of any state pension or benefits they were receiving.
5. What Documents You Receive
After registering the death, you will receive:
Death Certificate (£12.50 per copy, multiple copies may be needed for banks, pensions, and legal purposes).
A Certificate for Burial or Cremation (Green Form). Needed to arrange the funeral.
If applicable, a Certificate of Registration of Death (Form BD8). Used to notify the DWP of any state pension or benefits.
6. Using the Tell Us Once Service (Optional)
This government service notifies multiple organisations (e.g. DWP, DVLA, HMRC, Passport Office) in one go.
The registrar will provide a unique reference number to use online or by phone.
5. Organising the funeral;
Organising a Funeral in the UK
Once the death is registered, you can begin arranging the funeral. The process depends on whether the deceased left instructions in their will or had a prepaid funeral plan. If no plans exist, the executor or next of kin will make the arrangements.
- Check for Funeral Wishes or Plans.
Check if the deceased had a prepaid funeral plan this could cover costs and arrangements.
If no wishes are recorded, the family or executor will decide.
2. Choose a Funeral Director (or Arrange It Yourself)
Most people use a funeral director to handle arrangements. To find one:
Use a National Association of Funeral Directors (NAFD) or Society of Allied and Independent Funeral Directors (SAIF)-accredited provider.
Compare costs and services before committing.
If arranging the funeral yourself, you will need to handle the paperwork, transport, and burial or cremation directly.
3. Decide on Burial or Cremation
Burial: Choose a churchyard, cemetery, or woodland burial site. If the deceased owned a grave plot, check ownership details.
Cremation: Book a crematorium and decide on the handling of ashes (e.g., scattering, keeping in an urn, or interment).
For a woodland burial, you need to contact a natural burial site and check their requirements.
4. Book the Venue and Service
Decide on:
Location: Church, crematorium, graveside, or alternative venue.
Religious or Humanist Ceremony Arrange a minister, celebrant, or family-led service.
Order of Service, Hymns, music, readings, eulogies.
Transport: Hearse, family cars, or a simple vehicle.
Flowers or Donations: Many families request charity donations instead of flowers.
5. Handle Legal and Administrative Requirements
Provide the Certificate for Burial or Cremation (Green Form) to the funeral director.
Cremations require an Application for Cremation (Form 1), signed by the executor or next of kin.
If using a burial plot, check local council or cemetery regulations.
Arrange the Reception (Wake)
A wake can be held at a home, pub, or venue.
Catering options range from formal meals to tea and sandwiches.
Some families choose to display photos or a memory book.
5, Funeral Costs and Payment Options
Funeral costs can be paid from:
The deceased’s bank account (banks usually release funds directly for funerals).
A prepaid funeral plan.
Life insurance or estate funds (reimbursed later).
Government support (Funeral Expenses Payment) if the family is on low income benefits.
Inform Attendees and Place a Death Notice
Send invitations to friends and family.
Place a death notice in local newspapers or online funeral sites if desired.
Use social media or group messages to inform people efficiently.
Contacting Tell Us Once;
Contacting Tell Us Once
Tell Us Once is a government service that notifies multiple organisations about a death in one go, reducing the need to contact them individually.
1. How to Access Tell Us Once
You can use Tell Us Once online or by phone after registering the death. The registrar will provide a unique Tell Us Once reference number.
Online: Visit Tell Us Once and enter your reference number.
By phone: Call the Tell Us Once service (the registrar will provide the contact details).
If you don’t receive a reference number, ask at the register office when you register the death.
2. Who Tell Us Once Notifies
Using the service informs:
HM Revenue & Customs (HMRC) – Income tax, benefits, and National Insurance.
Department for Work and Pensions (DWP) State Pension, disability benefits, Carer’s Allowance.
Passport Office Cancels the deceased’s passport.
Driver and Vehicle Licensing Agency (DVLA) Cancels their driving licence and updates vehicle ownership.
Local Council: Stops council tax, blue badges, benefits, and electoral roll registration.
Veterans UK Cancels military pensions (if applicable).
3. Information You Need to Provide
Tell Us Once reference number (from the registrar).
Deceased’s full name, date of birth, and National Insurance number.
Details of any benefits, pensions, or tax credits they received.
Driving licence number (if applicable).
Passport number (if applicable).
Spouse or next of kin’s details (so their records can be updated).
4. What Happens Next?
You receive a confirmation of who has been notified.
Some organisations may contact you for further information.
If the deceased received benefits, the DWP may arrange a final payment or reclaim overpaid funds.
Undertaking a search on the National Wills Register:
Undertaking a Search on the National Will Register
If you need to check whether a will exists or locate the most up-to-date version, you can search the National Will Register (provided by Certainty, part of The Law Society). This can help confirm whether a will has been officially registered and where it is stored.
Steps to Conduct a Will Search
1. Determine If a Search Is Necessary
A National Will Register search is useful when:
You cannot find a will among the deceased’s documents.
You want to verify that you have the latest version.
There is uncertainty or disputes about whether a will was made.
2. Choose the Right Type of Search
There are two main types of searches:
Will Register Search. Checks whether a will has been registered and where the original is stored (usually with a solicitor or will writer).
Will Search Combined. Includes the register check and a search for unregistered wills by contacting solicitors and will writers in relevant areas.
3. Submit a Search Request
You can apply online via the National Will Register website.
You’ll need details of the deceased:
Full name (including any variations they may have used).
Date of birth.
Date of death.
Last known address.
There is usually a fee for the search service.
4. Receive the Search Results
If a will is found, you’ll be informed of its location (e.g., at a solicitor’s office or a secure storage facility).
If a will is not found, this does not guarantee one doesn’t exist it may simply not be registered. Further searches may be needed (e.g., checking with local solicitors, the deceased’s paperwork, or their bank).
What If No Will Is Found?
If no valid will exists, the estate is distributed according to intestacy rules, which determine who inherits based on legal hierarchy.
Organising estate notices in line with of the Trustee Act 1925;
Organising Estate Notices Under the Trustee Act 1925
Under Section 27 of the Trustee Act 1925, executors or administrators can protect themselves from personal liability by placing a statutory estate notice. This notice gives creditors and claimants a deadline to come forward with any outstanding debts or claims against the estate.
Steps to Organise an Estate Notice
1. Publish the Notice in the Correct Locations
To comply with the law, the notice must be placed in:
The London Gazette. This is a legal requirement and ensures the notice reaches creditors nationwide.
A local newspaper. Published in the area where the deceased lived or owned property, so local creditors are informed.
Some estates also place notices in specialist publications (e.g., The Farmers Weekly for agricultural estates).
2. Include the Required Information
The estate notice must contain:
The full name of the deceased.
Their last known address.
The date of death.
A statement that the executor is handling the estate.
A deadline (at least two months from the date of publication) for creditors to submit claims.
The executor’s contact details or the solicitor handling the estate.
3. Wait for the Statutory Period to Expire
Creditors and claimants have two months from the date of the notice to submit claims.
4. Settle Any Valid Claims
If a creditor makes a valid claim within the deadline, the debt must be paid from the estate before distributing assets to beneficiaries.
If a claim is received after the deadline, the executor is not personally liable as long as the estate was distributed in good faith.
If no claims are received, the executor can distribute the estate safely.
Why Publish an Estate Notice?
Protects the executor from personal liability. Without a notice, the executor could be personally responsible for any unknown debts discovered later.
Ensures all creditors have a fair chance to claim.
Prevents future disputes over unpaid debts.
This is the list completed of general due diligence points
Notify Relevant Parties
Details of the deceased assets (bank accounts, property, investments, pensions, etc.).
Contact banks, building societies, insurance companies, and other organisations to obtain valuations.
Inform banks, creditors, utility companies, and government departments (e.g., HMRC, DWP). ‘Just say Once’
Arrange to freeze accounts to prevent unauthorised access.
Redirect post and cancel subscriptions or services.
Liabilities (outstanding debts, loans, or credit card balances).
When valuing an estate for probate or inheritance tax (IHT), any liabilities must be deducted from the total assets. These liabilities include:
1. Outstanding Debts
Mortgages Any remaining mortgage balance on a property must be accounted for. If the mortgage was covered by life insurance, the payout may clear the debt, reducing the liability.
Loans, Personal loans, bank loans, and car finance agreements must be deducted from the estates value.
Credit Cards. Any unpaid balances on credit cards must be settled from the estate.
2. Bills and Financial Obligations
Utility Bills. Outstanding electricity, gas, water, and phone bills must be cleared.
Council Tax. Any unpaid council tax up to the date of death is a liability.
Rent or Service Charges. If the deceased rented property or owned a leasehold property with service charges, these may still be due.
Income Tax or Capital Gains Tax. Any unpaid tax from the deceaseds earnings or investments must be settled.
3. Overpaid Benefits or Pensions
If the deceased received state benefits (e.g., pension, disability allowance) or a workplace pension after death, these overpayments must usually be repaid.
4. Funeral Expenses (Not an IHT Deductible Liability)
Funeral costs (e.g., burial, cremation, service fees) can be paid from the estate before distributing assets to beneficiaries.
However, HMRC does not consider funeral costs a deductible liability when calculating inheritance tax.
5. Business or Other Debts
If the deceased had business debts, these must be settled from the estate.
Joint debts (e.g., a mortgage held jointly) usually pass to the surviving owner, who remains responsible for repayment.
What Happens if the Estate Cannot Cover Liabilities?
If debts exceed the estates value, it is insolvent and must be administered carefully.
Secured debts (e.g., mortgages) must be paid first, followed by funeral costs, then unsecured debts (e.g., credit cards).
Beneficiaries do not inherit debts unless they were joint borrowers or guarantors.
4. Value the Estate
Determine the total value of the estate, including all assets and liabilities.
In the context of valuing an estate, liabilities are the debts and financial obligations that must be deducted from the total value of the deceased assets to determine the net estate value. These liabilities can include:
1. Outstanding Debts. Any money owed by the deceased, such as mortgages, personal loans, credit card balances, or car finance agreements.
2. Unpaid Bills Utility bills, council tax, phone contracts, or any other regular payments due at the time of death.
3. Funeral Expenses. Reasonable funeral costs can often be deducted before calculating inheritance tax.
4. Taxes Owed. Any income tax, capital gains tax, or inheritance tax that the deceased owed at the time of their death.
5. Overpaid Benefits or Pensions. If the deceased received benefits or a pension payment they were not entitled to (for example, paid after their death), these may need to be repaid.
6. Legal and Probate Fees. Costs incurred in administering the estate, such as solicitors fees or probate application costs, may sometimes be considered.
7. Other Liabilities. Any contractual obligations, unpaid business debts (if applicable), or loans secured against property.
When valuing an estate for probate or inheritance tax, these liabilities are deducted from the total assets to determine the net estate value, which is used to assess whether inheritance tax is payable.
Valuation of assets. Before removing anything from the house.
No, nothing should be removed from the estate before its value has been assessed for probate and inheritance tax (IHT) purposes. The executor or administrator is legally responsible for valuing the estate correctly, and removing assets beforehand could lead to legal and tax consequences.
Exceptions. What Can Be Paid or Claimed Before Valuation?
While assets cannot be removed, some payments and deductions are allowed before the final valuation:
1. Funeral Expenses. Reasonable funeral costs (e.g., burial, cremation, coffin, and service fees) can be paid from the estate before probate is granted.
2. Debts & Liabilities. Some debts (e.g., mortgages, credit cards, loans) can be settled if funds are available in the deceaseds bank accounts. Banks may release money directly for these purposes.
3. Jointly Owned Assets. If an asset (e.g., a joint bank account or home owned as joint tenants) passes automatically to the surviving owner, it does not form part of the probate estate, but it must still be considered for inheritance tax.
4. Household Bills. Utility bills, rent, or council tax owed up to the date of death can usually be settled from the estate.
What Happens If Assets Are Removed Illegally?
If assets are taken before valuation:
It may be considered theft if done without legal authority.
It can affect inheritance tax calculations, leading to penalties from HMRC.
Beneficiaries or creditors could challenge the estate administration in court.
Best Practice for Executors
Secure valuable assets but do not distribute them until probate is granted.
Keep records of all estate assets and debts.
Obtain professional valuations for significant assets like property, antiques, or jewellery.
Liabilities (debts, funeral costs, unpaid bills)
Contact banks, building societies, insurance companies, and other organisations to obtain valuations.
Obtain property valuations if applicable.
Assess personal possessions (jewellery, vehicles, etc.).
Personal possessions (also known as chattels) need to be valued as part of the estate for probate and inheritance tax purposes. The valuation can be assessed by different people, depending on the complexity and value of the items:
1. Executor or Administrator. If the possessions are of low or modest value (e.g. everyday furniture, clothing, household items), the executor can make a reasonable estimate based on market value.
2. Professional Valuers. If the estate includes valuable items such as antiques, jewellery, fine art, or collectibles, a professional valuer (such as an auction house, antiques dealer, or specialist appraiser) should be consulted to provide an accurate valuation.
3. Estate Agents (for Property) If the estate includes real estate, a local estate agent or surveyor is usually required to provide a valuation.
4. HMRC Guidance For inheritance tax purposes, HMRC requires that possessions be valued at their open market value, meaning the price they would realistically fetch if sold, rather than insurance or sentimental value.
If the estate is complex or includes high-value items, HMRC may request a formal valuation, and in some cases, they may challenge the figures submitted.
Check for Inheritance Tax (IHT) Obligations
Calculate if Inheritance Tax is due (threshold currently at £325,000 in the UK, unless other exemptions apply).
Inheritance Tax (IHT) obligations refer to the legal duty to assess, report, and, if necessary, pay tax on the estate of a deceased person. These obligations generally fall on the executor (if there is a will) or the administrator (if there is no will).
Key Inheritance Tax Obligations
Determine if IHT is Payable
The current IHT threshold (nil-rate band) is £325,000. If the estate total taxable value is below this, no IHT is due.
If the deceased left their home to direct descendants (children or grandchildren), the residence nil-rate band (RNRB) can increase the threshold to a maximum of £500,000.
Anything above the threshold is usually taxed at 40%, though this can be reduced to 36% if at least 10% of the estate is left to charity.
Value the Estate
Calculate the total value of assets, including property, savings, investments, and personal possessions.
Deduct any liabilities (debts, funeral costs, unpaid bills).
If any gifts were given in the seven years before death, they may be subject to IHT.
Submit the Necessary IHT Forms
If no IHT is due, complete form IHT205 (for simpler estates) or IHT400 (for more complex estates).
If IHT is due, a full tax return (IHT400) must be submitted to HMRC.
Pay Any IHT Due
IHT must be paid within six months of the persons death. After this, interest accrues on any unpaid tax.
Payment can often be made using estate funds, including from bank accounts or the sale of assets.
In some cases, IHT on property can be paid in instalments over 10 years, but interest will be charged.
Obtain Probate (if required)
Before distributing the estate, the executor may need to apply for probate (or letters of administration if there is no will).
HMRC must confirm that any IHT due has been settled before probate is granted.
Keep Records
Executors must keep records of valuations, tax calculations, and payments made, as HMRC can request evidence for up to 20 years after the estate is settled.
Pay any tax due before applying for probate (tax may need to be paid in instalments, especially for property).
. Complete the Probate Application
Fill out the probate application form (PA1P for a will, PA1A if no will exists).
Submit the completed forms and supporting documents to the Probate Registry.
Pay the Probate Fee
Pay the application fee (£273 for estates over £5,000 as of 2023; no fee for estates under £5,000).
Submit the Application
Send the completed probate application, the original will (if applicable), and supporting documents to the Probate Registry.
Grant of Probate
Once approved, the Probate Registry will issue the Grant of Probate (or Letters of Administration if there is no will). This document gives the executor or administrator legal authority to manage the estate.
AN END OF LIFE PLAN 