There is no doubt that dealing with the death of a loved-one can be a very difficult and stressful time. Unless you have experienced bereavement before, you will probably be unsure just what you have to do. You are likely to be faced with a barrage of unfamiliar terms, such as ‘probate’ and ‘estate administration’, and to have a lot of questions about matters which require immediate attention.
Whether you simply need some advice or guidance on what steps to take or you are looking for someone to carry out the services on your behalf, we are here to help you.
What is probate?
Probate is simply proving the validity of a will and ensuring that the executor(s) knows exactly what to do. There are certain legal formalities which must be carried out, including payment of any inheritance tax due, before an application for probate can be made.
Can I handle probate myself?
In simple cases, the answer is ‘yes’. However, even what appears to be a straightforward estate can prove surprisingly complex and time-consuming to unravel – and remember that executors can be held personally liable for any losses caused to the estate (not only during the administration process, but afterwards too). It is recommended that legal advice be sought from a specialist probate lawyer.
What happens if there is no will?
If a person dies without making a will (called dying intestate), then a different procedure must be followed, in which the courts grant something called letters of administration, with the estate now distributed according to the rules of intestacy. This process can take a lot longer, is much more expensive and is often the point where family disputes start, simply because no will was written!
A partial intestacy can occur if a will has been made, but has not been written correctly or does not dispose of all of the deceased’s property.
Inheritance tax savings
If the net value of an estate is more than £325,000 (the current nil-rate band), then IHT (inheritance tax) will be payable to HM Revenue & Customs. In some cases, the tax liability can be substantial, and must be paid before a grant of probate or letters of administration are issued.
Significant savings can be made by planning ahead; this can be done by seeking legal advice at the time of writing your will and/or seeking independent financial advice from a tax expert.
It may be possible to vary an existing will, in order to make it more tax-efficient. If you would like further information or advice, please feel free to contact the Hoffman Briggs team.