This note has been prepared to provide guidance to our clients who are administering an estate with our assistance. It is intended to be a guide not as to the legal aspects, on which we will report and update you during the process, but as an outline of the procedure. We stress that it is only a guide and there can be significant differences on particular cases.
Entitlement to administer the estate
One of the first steps is to ascertain who is entitled to administer the estate. If the deceased left a valid will the will specifies who is entitled to administer the estate; this person is known as the "executor". If the deceased did not leave a valid will we will need to discuss the intestacy rules to determine whether you are entitled to deal with the estate and/or if anyone else’s entitlement takes precedence.
Investigating the estate
We will require from you details of the assets and liabilities of the estate, for example property title deeds, bank statements, share certificates, bills and invoices. Based on the information provided by you we will take steps to ascertain the assets and liabilities of the estate and the value of those assets and liabilities in order to prepare an inheritance tax return on your behalf.
Before applying for a "grant" (a court order) authorising you to deal with the estate we will need to submit on your behalf an account to H.M. Revenue & Customs and arrange for any inheritance tax due on the estate to be paid. Inheritance tax is calculated at a rate of 40% on the value of the estate but part of the estate (currently £325,000) is exempt from inheritance tax and there are other exemptions available, including for assets passing to the deceased’s spouse or a charity. Once we have full details of the value of the estate we can advise whether inheritance tax will be payable and calculate the amount payable.
The grant and distributing the estate
Once the inheritance tax has been dealt with we will prepare your application to the Probate Registry for the grant to be issued in your favour. The application is by way of an oath sworn by you that the deceased has passed away, that you are entitled to the grant and will properly administer the estate. Once received the grant will give you the authority to wind up the deceased’s affairs, for example transferring any land registered in the name of the deceased or closing his or her bank accounts. As the executor or administrator of the estate you will have a duty to distribute it in accordance with the will or intestacy rules, whichever applies to your case. We will prepare estate accounts so that you have a proper record of the value of the estate and its distribution.
We charge fees in accordance with the Law Society’s guidance on charging in non-contentious matters, that is on the basis of the time we spend on the case and the value of the estate. We endeavour to provide a costs estimate to you at the outset of your case or as soon as we have the relevant details about the estate. Usually our fees start from £750 plus VAT. You will also have to pay disbursements, which will include probate fees in the region of £165 and may include, amongst other things, stockbroker’s fees if there are shares in the estate and Land Registry fees if there is land in the estate. We usually defer issuing our invoice until we hold money on behalf of the estate, for example once the proceeds of the deceased’s bank accounts have been paid over to us. This means we can usually retain our fees from the funds in the estate rather than asking you to pay them directly.
[Correct as at March 2014]