When do you need probate?

I shall begin this article by clarifying two key points that often arise:

  1. Probate describes the power/authority given to executors (who may be named by a will), by the courts, to undertake their job of executing a will. It is not the entire process of ‘sorting out’ a dead person’s affairs. This authority is conferred on the executors by a ‘grant of probate’ given by the courts.
  1. Probate is required in most cases. The existence of a will does not remove the need for probate. Probate may not be required if the deceased’s estate was very small or comprised largely of ‘jointly owned’ assets e.g. bank accounts (which may pass outside of the will by survivorship).

In essence, probate is needed whenever, an executor (or administrator) needs to ‘step into the shoes’ of the deceased to act on their behalf, and under the terms of a will. Institutions such as banks have their own rules/thresholds (which vary) by which they allow access to a dead person’s bank accounts in the absence of probate. So, if an estate is small and comprised only of bank savings, you should ask their bank first, if probate is needed. 

What is the difference between probate and estate administration?

Returning to my earlier point, ‘estate administration’ is the process of ‘sorting out’ a dead person’s affairs. Probate falls within this umbrella definition. There is always some estate administration to do after death, probate is not always required. 

What are letters of Administration?

Letters of administration (a term used interchangeably with ‘Grant of Representation’) are the documents, issued by the probate registry, to executors, allowing them to act. They are public documents and their presentation may be requested of executors by e.g. banks. 

Is the process complex and what expert knowledge is needed?

If there is a will, executors are able to apply for probate. Obtaining this authority may take some time. A rough valuation of the deceased’s estate should be made before application, as whether or not the person needs to pay inheritance tax may affect the process of application. The executors are charged with identifying all of the assets and debts of the deceased, also all creditors and beneficiaries. They must ensure they have the latest will.

The steps laid out may be administratively onerous, moreover, results may be imperfect, as such there are procedures such as placing advertisements in certain publications and obtaining multiple valuations for e.g. property , which should be followed. 

It is important to remember that an executor may be held personally liable for errors in administering an estate, so it is important that care is taken. 

What does professional assistance look like?

Many executors engage professionals (e.g. a solicitor) to support them in administering a dead person’s estate. This approach has a number of benefits, non-exhaustively: i) it saves time; ii) introduces impartiality to the process; iii) professionals carry insurance in case of error (mitigating executor liability); iv) tax efficiency can be considered. 

You should certainly ‘consider’ the use of professionals in the following situations:

  • The value of the estate is over the Inheritance Tax threshold.
  • There are doubts about the validity of the will
  • The deceased had dependants who were deliberately left out of the will, but who might want to make a claim on the estate
  • The estate has complex arrangements, such as assets in trust
  • The estate is bankrupt
  • The estate includes foreign property or foreign assets

Probate is potentially complex and must be undertaken with care, further, there are time constraints. If you have doubts please contact us now, for a free initial consultation (book a free consultation at www.confidencewills.co.uk).