Do I need a solicitor to organise probate or letters of administration ?
(or Help! I am an executor of a will what do I do next?)
The short answer is no you do not need a solicitor but in some cases it is advantageous to you to use one (we are lawyers so do you expect a straight answer!).
We are a firm of solicitors who deal with a great deal of probate work but we recognise that there is no one size fits all solution. For simple estates it is suitable for many people to deal with the matter personally without professional advice.
However in some cases people need help. Dealing with another persons estate can be complicated and there are specific obligations on the executor or administrator of the estate which may expose them to personal liability if they get things wrong.
This article will help you understand some of the basic requirements and give you an overview of the steps you are required to take. It is meant to be candid but clearly you should not take any steps in reliance of any comments within the article without specific legal and / or tax advice.
If you are still unsure if you need professional assistance please call David Farr, Partner on 01708 707821 who can talk you through the options.
To start to understand your role you need to understand the basics.
What is “Probate” and how is it different from “Letters of Administration”?
Essentially a grant of Probate is obtained where there is an executor appointed in a will and Letters of administration is obtained where there is no will or no executor*.
Both basically grant a legitimacy to the person appointed to enable them to deal with a deceased’s persons estate. For example you will need the grant of probate to sell any assets including the deceased’s house.
*There can also be a situation where a copy of the Will has been found but not the original. Clearly professional advice should be obtained if there legitimacy or finality of the will (this is a another can of worms).
Who can apply for Probate?
Usually this is one or all or the executors named in the will. If there is no professional executor appointed this is normally a family member. The executors can appoint solicitors to assist them in this process.
Who can apply for Letters of Administration?
There is a pecking order but it is usually the spouse followed by the children of the deceased. They are known as “administrators”. Again the administrator can seek professional advice to assist them in this application.
Where do we get the ‘application forms’ from?
In either case there is the need to apply to the Probate Registry for a formal document appointing the executor or administrator.
You normally apply at your local probate registry – see https://courttribunalfinder.service.gov.uk/search/postcode?aol=Probate
What forms do you need?
- probate application form (PA1)
- Inheritance Tax form – this is an Inland Revenue Form (this depends on the domicile of the deceased and the size of and the nature of the assets in the estate).
- official copy of the death certificate (you need to register the death to obtain this – see http://www.ker.co.uk/registering-a-death/
- the original will and three copies if there is one. If there have been changes then you need to send any amendments or codicils (tip – do not staple or attach anything including paperclips to the will as this will mark it and only induce questions from the probate registry).
- application fee of £215
It is very useful to order extra copies of the grant (50p each) – get half a dozen – this means you can send them to different organisations at the same time.
Before you fill in the forms….
We are however getting to the procedural parts before we consider the practical steps each executor or administrator needs to take.
The starting point is to establish the size of the estate by that we mean finding all the assets held by the deceased and the value of those assets. This means bank and other savings accounts, life and other policies (unless written in trust), significant personal assets including cars, share values and of course the value of houses or flats both here and abroad. Sometimes personal items such as jewellery can be worth much less than anticipated (we can advise on all the appropriate steps required to value such items).
You then need to identify all of the debts of the deceased including mortgages and tax due to the Revenue.
As the executor or administrator you have a legal responsibility to pay off any debts or outstanding payments before distributing the estate.
There may also be tax to pay if there is tax due on the estate before probate can be granted.
Can you instruct a solicitor to deal with the probate when a solicitor was not appointed in the will and how are their costs recovered?
A big concern for lay executors and administrators is whether they can appoint a solicitor to assist them in any aspect of the probate process.
It is perfectly acceptable to appoint a professional to assist in all or any aspect of the probate process. In fact as you will see below it may be sensible for you to appoint solicitors to remove the risk of personal liability.
You can use money from the estate to pay any solicitor’s fees as part of the probate /administration process so executors or administrators do not need to dig into their own pockets.
Are there any risks associated with becoming an executor or administrator?
This is one of the reasons we get instructions (even on simple estates). Being in a such a position can carry risks. This can mean that you may be personally liable, typically if you make a mistake and distribute the assets of the deceased to the beneficiaries before taking into account all interested parties.
There are several typical risk areas:
- If you fail to pay a debt of the estate before distributing the rest of the money in the estate you could become liable for those debts.
- You also have a financial risk to the beneficiaries because you are acting in a specific fiduciary capacity to the beneficiaries of the estate and this means that if you make a mistake you may be asked to pay them compensation for the loss. See our article on the Duties of Trustees
- You should be wary of charities, the Inland Revenue and the Trustee in Bankruptcy of a bankrupt beneficiary.
What you can do to mitigate those risks?
Advertise for creditors in the London Gazette and if the deceased owned their own home in a local newspaper – this is a standard step which will cover you in the event of a late claim. You can also take out specialist insurance.
Make sure you are accurate with the Inland Revenue – we all realise that the Revenue will pursue you if you deliberately try to mislead them. Everyone would expect a penalty in those circumstances and they don’t disappoint with penalties between 35%-100% of the tax if they catch you out.
However you will find that the Revenue can penalise even careless mistakes
The revenue will charge a penalty of between 15% and 30% of the tax if they contact you about a careless mistake you have made on the forms. It therefore pays to be accurate and to keep clear records of the sources of information you have for values of assets for example.
Charities – You should no longer be surprised that charities actively pursue – almost aggressively – any payments due to them under the will. They may question the values associated to assets if they have a % stake in the estate so you again need to keep clear records and evidence that you have complied with the requirements of a diligent executor.
Are there any other advantages to appointing a professional executor?
We can look at the tax.
There are a couple of things we commonly come across including post death deeds of variation where we can with the agreement of the beneficiaries rearrange the distribution of the estate to avoid the need to pay inheritance tax (or event to just vary the way in which the estate is distributed).
Also in a rising property market we can also prepare a deed of appropriation so that executors are able to use their Capital Gains Tax (CGT) personal allowance to offset any gains made in the property value from the date of death. Otherwise the Estate of the deceased may be liable to pay CGT on the gain.
We can also advise on practical matters such as how to get free valuations on property from local agents and in some cases we have access to special rates negotiated with estate agents to sell the probate property.
Are there any other reasons?
We are reducing a personal burden of dealing with a loved ones estate. Sometimes it is just difficult to deal with the personal affairs of a family member.
We can help shoulder that burden.
What do you charge?
The good news is that unlike some firms we do not charge on the value of the estate. This results in large value estates (and even modest estates) being charged large fees for the lawyers which sometimes bear little resemblance to the actual timed work carried out.
In very small estates we charge a fixed fee of £450 plus VAT for obtaining a Grant of Probate plus the probate court fees.
For larger estates we deal with it on a hourly rate – if you call or email us with the basic details we can give you details of the estimated charges.
We can also deal with the sale of the property at the end of the process for a fixed cost from £499 plus VAT.
Appoint a specialist professional to assist with your Probate Application
If you require further information please contact David Farr on 01708 707821 or email firstname.lastname@example.org