Probate
Probate is the legal authority to administer an
estate.
A Grant of Probate gives an individual the power and can be
applied for by the Personal Representatives (PRs) of the estate. If
a Will has been made then the PR(s) will be the Executor(s)
nominated in the Will, but if no Will has been made then they
will be the next of kin of the deceased. People who are required
to handle the estate in this scenario are called
Administrators of the estate.
The PR has four main duties which are:
- To gather and evaluate the assets of the
estate. This is basically taking an inventory of
everything owned by the deceased and providing valuations
for the various items. Everything needs to be included, such
as bank and building society accounts, shares, cars, houses and
furniture.
- Obtaining the Grant of Probate (or Grant of
Letters of Administration if there is no Will). Without this
document, which needs to be acquired by the Probate Registry of the
High Court, organisations will not hand over the deceased's assets
to the PR if the assets are above a certain threshold (typically
£5,000). Before giving either type of Grant, the Court will demand
to see the Will if there is one, along with the Oath, which is
a sworn document signed by the PR(s) outlining how they agree to
act and giving the valuation of the estate.
- To pay any Inheritance Tax (IHT) due.
If IHT (which is set at 40% for estates worth £325,000 or
more) is payable then some or all of it must be paid before a Grant
will be issued. This is because the government is cautious and
wants to be certain of getting the money. Many people pay this off
by taking out a loan at a special rate from a solicitor.
- To distribute the balance of the estate to
those who are entitled, in accordance with the terms of the Will,
or the rules of intestacy if no Will has been made. PRs must
keep a log of all the money paid, received or passed on, which all
the beneficiaries are entitled to see. However, the PRs do not have
to carry this burden alone - solicitors are often enlisted, as the
legal fees can be taken from the estate. That is if a solicitor was
not originally named as an Executor, which is often done so that
the process can be completed more quickly.