Once someone has died, it becomes necessary to wind up their affairs in as orderly and timely a manner as possible. This process is known as the administration of an estate.
Grants Of Representation
If the deceased owned shares or land in his or her own name – or had assets totalling more than about £15,000 – then it will usually be necessary to obtain a Grant of Representation. This is a document issued by the Probate Registry – a division of the High Court.
Where the deceased left a will, a Grant of Probate will be appropriate. If there was no will then the deceased is said to have died intestate – and a Grant of Administration would be used.
In either case Personal Representatives (also called executors or administrators) will be appointed to administer the estate. Their duty is to comply with the conditions of the will – or to follow the intestacy rules, if there is no will.
If the estate is of a relatively small value (perhaps consisting of a bank account with less than £15,000) then it will not usually be necessary to obtain a Grant of Representation. However, some building societies insist on a Grant in order to release funds of more than about £5,000 and so you just have to make enquiries and see what is required.
Jointly owned assets will usually pass to the surviving owner(s) automatically and without the need for a formal Grant. Indeed, in most cases they will not be deemed to form part of the deceased’s estate at all.
In the case of jointly-owned land registered with the Land Registry one need only send in a prescribed form and a copy of the death certificate of the deceased in order to amend the register for the property. The Land Registry will remove the name of the deceased from the register and send out a copy of the amended register.
For jointly-owned bank accounts and the like just take a copy of the death certificate to the bank, and they will attend to the formalities.
This tax is payable on death if the value of the deceased’s estate is worth more than a set level fixed by the Government from time to time – known as the ‘nil-rate band’. At present the nil rate band is set at £325,000 (or £650,000 if your spouse or Civil Partner died before you and left their estate entirely to you).
If your estate is worth more than the nil rate band then the excess is taxed at 40%. Many estates do not exceed the allowed levels and so Inheritance Tax is not payable.
Inheritance tax is largely payable before a Grant of Representation can be applied for and so funds will have to be released from a cash source in order to achieve this. HM Revenue & Customs can be approached to see if any due tax can be deferred to the point where the assets can be realised (after the issue of the Grant) although there can be additional interest payable. Failing this if there is insufficient cash then the Personal Representatives may have to consider a loan to fund the payment.
There are a number of allowances and exemptions that could be applied to the estate in order to minimise the tax that becomes payable and we would be happy to advise as to these. Most tax planning is best done well in advance of death, of course.
Changing the terms of a will after death
Odd as this may sound, there may be good reasons to amend a will after a death. It can be an opportunity to carry out tax planning, or to re-direct assets to avoid family difficulties. Perhaps to place assets in trust for grand-children or different ‘sides’ of the family.
This is known as a Deed of Family Arrangement and, where required, a will can be changed at any time up to 2 years after the date of death of the deceased. Even if no will was made, the terms of the intestacy can be changed in the same way. Note that any person who will receive less after the change than before it must consent to the Deed.
Payment Of Funeral Accounts
A bank or building society (or, indeed many financial institutions) will allow cash funds to be released from the account or portfolio in order to meet the costs of a funeral. We would certainly look to deal with this aspect as a priority when administering an estate.
Costs and Expenses
We will always tell you, at the outset, the level of our anticipated charges and expenses. Every estate is different in terms of overall value, or types of assets, or range of distribution to beneficiaries – and so we tailor our charges to what we think will be involved. In most cases, employing a local solicitor will prove more cost-effective than using a bank or similar entity – and we are, by definition, local and available to talk to when you need us. If you find it frustrating to contact a call-centre and speak to a different person each time you call – then you will find it a refreshing change to deal with us.
You are likely to find that other organisations, such as banks or corporations, tend to operate on a sliding-scale charge based on the value of the estate but also have a number of ‘bolt-ons’ which can serve to increase the cost of the exercise quite dramatically. Don’t just take our word for it – ask!
Mark qualified as a solicitor in 1985 and has been a partner since 1990. He is now our senior partner.
He has expertise in the preparation of wills, and has considerable experience in the administration of estates, deeds of family arrangement and related inheritance tax issues. He can provide advice where there is no will, and also where a will becomes contested.
He regularly advises upon the creation and tailoring of Lasting Powers of Attorney, and in relation to Court of Protection applications where the person concerned no longer has the ability to manage their own affairs.
Mark advises in all aspects of conveyancing (both commercial and residential), including development and with commercial landlord & tenant transactions. He has experience of dealing with contested issues before the First-tier Tribunal of the Property Chamber, and in relation to boundary and rights disputes concerning property and ownership claims – including those by adverse possession.
He also regularly assists small businesses in the practical resolution of employment issues.
Tel: 01289 301284
John joined in 1970, qualified as a solicitor in 1975 and was our senior partner until the end of December 2014. He has now retired as a partner but continues to assist the firm as a Consultant Solicitor on a part-time basis.
Coming from a farming background, he has a particular interest in agricultural matters, including the forming (and changing) of farming partnership agreements and Farming Business Tenancies. He also specialises in commercial conveyancing and all aspects of landlord and tenant work.
John developed an expertise in Wind Farm agreements and related legal arrangements and continues to hold an interest in this area.
Tel: 01289 301289
Frances joined the firm in 2000, completed her training with TC Smith and qualified as a solicitor in 2002. She became a partner in August 2014.
Her interests are in all aspects of commercial conveyancing, including residential developments. She also has considerable experience in assisting with residential conveyancing.
Her family are actively involved with farming, and she has a keen interest in agricultural matters – heading up the firm’s agricultural section with assistance from John Marshall. In 2014 Frances qualified as a Fellow of the Agricultural Law Association, and this has enhanced her expertise in all areas of rural practice – including agricultural holdings, farm sales and purchases, estate planning & taxation, town & country planning and the common agricultural policy.
Frances also advises as to the preparation of lasting powers of attorney and wills – and the administration of estates.
Tel: 01289 301294
Susan joined the firm in 1979, and is our accounts executive, and also a para-legal with a special interest in the administration of estates.
She has been working in this particular field for years and has developed a clear and effective way of administering estates both large and small. She has a friendly and approachable manner and is always willing to explain what has to be done to wind up an estate.
Tel: 01289 301291