Probate is the legal and financial process of dealing with the property, money, and possessions (the assets) of someone who has died. It also involves proving that a will, if there is one, is valid, and confirming who has authority to deal with the estate.
A Grant of Probate is sometimes needed to allow the next of kin, or the executor of the will, to sell, distribute or transfer the assets of the deceased.
This is a legal document that gives permission to access bank accounts, settle debts and sell assets once someone has died. The document is only applicable when someone has left a will. If there was no will, then the document required for the same authority is known as a Grant of Letters of Administration.
Both these documents work in virtually the same way in that they give a designated person legal authority to administer the estate of the person who has died. To apply for probate or letters of administration, there is a fee to pay.
How does the probate process work?
There are five key phases of probate.
Phase one involves identifying all of the assets and liabilities of the deceased to ascertain the value of the estate. It also involves confirming who is entitled to inherit what from the estate, whether under the terms of a will if there is one, or in line with the intestacy rues if there isn’t. Identification documents will need to be collated for all beneficiaries at this stage.
Phase two of the probate process involves paying any Inheritance Tax due to HMRC, and filing the Inheritance Tax return. Once that’s done, an application can be made to the Probate Registry for a Grant of Probate or Grant of Letters of Administration (also known as a Grant of Representation), which confirms who has the legal authority to deal with the estate.
Phase three is the process of selling the deceased’s assets, settling any debts and paying the final estate administration expenses, as well as finalising any further Inheritance Tax, Income Tax or Capital Gains Tax that is due in or out of the estate.
Next, phase four is the step where the estate accounts are prepared. These show all the payments in and out of the estate, and the balance remaining for distribution to the beneficiaries. The estate accounts must be presented to the personal representatives (executor of the will or next of kin) for approval.
Finally, phase five of the probate process involves transferring the assets to the beneficiaries and distributing the balance of the estate according to the terms of the will, or the intestacy rules where no will was in place.
When is probate required UK?
In England and Wales, if someone dies leaving property or assets in their sole name, then a Grant of Probate or Grant of Letters of Representation is usually required.
Sometimes, a bank or other financial institution will ask for a Grant if there is more than a certain amount in the account.
Whether or not a Grant is required depends on the size of the estate and the value of individual assets. Small estates with no property and less than £5,000 in the bank generally don’t need you to apply for probate.
Individual banks tend to set their own limits in terms of whether a Grant is required. If they don’t need a Grant, they may still ask for a Statutory Declaration before they release any funds so that they can be sure they are releasing the money to only those who are authorised to deal with it.
Do I need to apply for probate to deal with joint assets?
If someone dies leaving joint assets, such as property or a joint bank account, this will automatically pass to the surviving co-owner under the right of survivorship. The co-owner will need to present the death certificate in order to formally transfer the asset into their sole name, but probate is rarely required for this.
For property that is owned as tenants in common rather than joint tenants, it is usually necessary to apply for probate. This is because the property is shared amongst the owners in individual parts. The individual part owned by the deceased will pass to the beneficiary named in the will, or in line with the intestacy rules, and probate will be required for this.
If a spouse dies leaving assets in their sole name or a property held as tenants in common, then again it will usually be necessary to apply for probate. Otherwise, for any joint assets, it won’t be required.
Who should apply for probate, and how long does probate take?
Where a will was left, this will name one or more executors and they will be responsible for making the application for probate. If they wish, they can formally redirect this responsibility to a solicitor.
Where no will was left, the rules of intestacy will determine whose responsibility it is to apply for probate, which will usually be the next of kin.
In terms of how long does probate take, from the date of death to the distribution of the estate, is usually around a year on average. Sometimes it will be less, but even the most straightforward of estates can take at least six months to complete. However, once a Grant of Probate of Letters of Administration has been issued, it should only take around six weeks for the estate to be distributed.
Seeking help with the probate process?
Whether you wish to hand over your full responsibilities as executor or personal representative, or need professional guidance with one or more aspects of estate or probate management, the dedicated experts at Partridge Muir and Warren are here to assist in the way that suits you best.
For the help you need on an individual basis, we welcome you to get in touch.