At Edmondson Hall we understand that the death of a family member or close friend can be devastating, the last thing you can think about at that time is the legal process and form filling involved in dealing with their personal affairs.
We also appreciate that you may, in time, want some sense of closure from the legal process.
We can offer you a compassionate Probate service in which we can do as little or as much as you feel you want us to do at a very difficult time. We are flexible, we will listen and we will adapt to your needs throughout the process.
That is why we have put together this article in which we aim to answer some of the important questions you may have at what is understandably a very upsetting and difficult time.
If there is anything you want us to expand upon or to clarify then please do not hesitate to ask.
Registering a death
It is a legal requirement to register a death as soon as possible.
The death may be registered by a family member, the ‘Executor’ of a Will (or the persons allowed to administer the deceased’s estate under government rules) or the person arranging the funeral.
The death must be registered at a Registry Office in the Local Authority area where the deceased died, even if they did not normally live in that area.
A document known as the ‘Medical Cause of Death’ will be completed by the doctor who either last saw the deceased alive or pronounced the death and that document must be taken to the appointment with the Registry Office.
Sometimes the deceased person may be examined by a Coroner who will only release the deceased to the family when their investigation has been completed. In most cases where a Coroner is involved, the Coroner’s Office will register the deceased’s death and therefore no further appointment at the Registry Office is needed.
An official copy of the Death Certificate must be sent to each institution in which the deceased held money or other investments. It is therefore usually a good idea to get at least 5 official copies of the Death Certificate from the Registrar or the Coroner at the time of the registering the death. It is possible to buy further official copies at a later date than the registration of the death, but the certificates are likely to cost more.
Arranging the funeral
A funeral can generally be arranged by anyone, but it is normally arranged by the deceased’s closest family members who may or may not be the Executors of the Will.
Some people have pre-paid or pre-arranged funerals and those details can often be found with the deceased’s personal papers. If the deceased did not have any such pre-arrangement, then the person arranging the funeral is responsible for its payment, from the deceased’s money.
If the deceased does not have enough money immediately available to pay for the funeral then the payment can be made by the person arranging the funeral and recovered from the deceased’s money when available.
Most banks and building societies in which the deceased held money will confirm whether the deceased has enough money to pay for the funeral from those accounts. The relevant bank or building society will need to see an official copy of the Death Certificate and the original funeral invoice once issued, in order to make payment to the funeral director.
If the deceased had a Will, it is important to check whether it allows for payment to be made from the deceased’s estate for related expenses such as the ‘wake’. If it does not, then technically, only the items on the funeral invoice itself are payable from the deceased’s funds and any related expenses must be paid for by the person who arranged for them.
The agreement of all persons inheriting from the deceased’s estate would have to approve payment of these related expenses from the estate, but they do have to agree.
What should I do with the property?
When someone dies owning property, the legal ownership of that property passes to the Executors as if they were the owners of it. In reality, the persons inheriting under the deceased’s Will (or the government rules where there is no Will) own the property.
This means that the Executors must keep the property secure, insured and free from any risks that may cause it to be damaged or to otherwise decrease in value. The Executors are normally the only persons who can grant access to and hold keys for the property, until the estate has been completed.
The Executors must therefore arrange for the property to be insured in their names. Executor insurance policies are different to general homeownership policies and care must be taken to comply with the conditions of the Executors insurance policy.
It is important to note that many insurance companies exclude insurance cover for damage to the property caused by the escape or build-up of water, particularly in unoccupied properties. The Executors must therefore make sure that all water appliances at the property are drained-down and that in the winter months, the pipes are kept warm enough so that they would not be damaged during freezing temperature.
How do I find out if the deceased had a Will?
Not everyone makes a Will.
The easiest way to find out if there is a Will is to check the deceased’s personal papers. Even if you do not find a Will, or at least a copy there, you may find contact details for professional advisors such as solicitors which would be a good starting point.
There is a national Will database known as Certainty.co.uk to which you could turn if you needed to search a wide area, perhaps the 20 miles within which the deceased lived.
What happens if there is no Will
The government ‘Intestacy Rules’ would apply to the deceased’s estate.
Those rules provide that the deceased’s estate is divided between close family members who are also usually the persons allowed to administer the estate as ‘Administrators’.
What is Inheritance Tax and when is it payable?
Inheritance Tax is only payable on the deceased’s estate if the total amount of their property, money and other investments, after subtracting their debts, is higher than what is known as the ‘Nil Rate Band’, or the 0% tax rate.
The current Nil Rate Band is £325,000.00 per person, from which are deducted all gifts of over £3,000.00 per year in the 7 years before the deceased died.
In April 2017, a new ‘Nil Rate Residence Band’ is being introduced, which may allow the deceased, depending on certain criteria, to pass on part of the value of their main residence at death to their children tax free. This is in addition to the general Nil Rate Band of £325,000.00.
There is no Inheritance Tax on estates passing entirely between married persons, Civil Partners or to charity. Depending on the circumstances, the surviving married person or Civil Partner can inherit the Nil Rate Band of the first to die to use in addition to their own Nil Rate Band when they themselves die.
There are other exemptions from payment of Inheritance Tax depending on the types of property and investments the deceased had when they died.
If Inheritance Tax is payable, it is normally at 40% over the Nil Rate Band. Inheritance Tax must be paid before you can get Probate.
Interest starts to run on any unpaid Inheritance Tax from 6 months after the month in which the deceased died (e.g. if in January, then interest starts from July).
Usually the deceased will have enough ready money (e.g. in bank accounts), to pay any Inheritance Tax due. However in cases where the deceased’s estate is mainly property, the deceased may not have enough ready money to pay the tax due and the Executors will have to apply to a bank or building society for what is known as a ‘bridging loan’ to pay the Inheritance Tax. The loan including all interest would be repaid as soon as enough money was available from the deceased’s estate.
Inheritance tax is payable immediately on ready money assets such as monies in banks accounts. It is payable in 10 equal annual instalments on non-ready money assets such as property and shareholdings.
In a situation in which there is Inheritance due on both the ready money assets and non-ready money assets, the tax on the ready money assets must be paid entirely, but only the first instalment is immediately payable on the non-ready money assets. If the Executors opt to pay just the first instalment on the non-ready money assets, then they can pay the further 9 instalments as soon as enough money is available.
What is Probate?
Probate is a legal document stamped by a Probate Registry, which allows the people appointed as Executors in a Will to prove that they have the authority to deal with a deceased person’s property, money and investments.
If a deceased person did not leave a Will, then the people entitled to deal with that deceased person’s affairs under the government Intestacy Rules can apply to a Probate Registry for a document known as ‘Letters of Administration’, which is a similar document to Probate.
Do I need Probate?
It depends on what the deceased person owned when they died.
If the deceased owned property, shareholdings or money in bank/building society accounts or other investments over a certain amount (different for most banks/building societies) in their sole name, then Probate is likely to be needed.
Probate is not usually required for property, money and investments which the deceased held jointly with someone else, as they would normally pass to the surviving owner.
The banks and other institutions in which the deceased held money or investments will often tell you whether or not you need Probate to deal with those assets.
Do I have to use a lawyer to get Probate?
You do not have to use a lawyer to get Probate as it is possible for you to make a personal application to the Probate Registry. However, they may not be able to help you with all of the necessary forms to make the application and they would make a charge for preparing the document known as the ‘Oath’.
The benefit of using a lawyer is that they can advise you whether Probate is necessary and guide you through the process of applying at a very stressful and emotional time. Lawyers will also be able to take the pressure off of you by preparing all of the forms for you to sign to apply for the document and then provide it to you once received.
It is recommended that you use a lawyer for high value or complex estates.
How long does Probate take?
It normally takes 3-6 months from the deceased’s death to get Probate. This depends on the complexity of the deceased’s property, money and investments.
The process of applying for and receiving Probate is only one stage in the administration of a deceased’s person’s estate.
It may take 12 months or longer from the deceased’s death to finalise the legal affairs of the estate.
What happens after Probate?
When Probate has been granted, the deceased’s Will becomes a public document and all persons entitled to inherit under the Will (known as the ‘beneficiaries’) must be informed.
Each institution in which the deceased held money or investments which require Probate, must be provided with an official copy of the Probate so that those accounts and investments can be cashed in, sold or transferred, as required by the Will or by the beneficiaries. Probate must also be provided to the Land Registry if the deceased’s property (in sole name) is to be sold or transferred.
The law requires that the Executors keep all of the deceased person’s property, money and investments separate from their own and as safe as possible. They must also maximise the value of the deceased’s estate wherever possible.
The debts of the deceased, including any tax, must be paid as and when the deceased’s money becomes available to the Executors. The Executors must also finalise the deceased’s tax affairs to the date of death and for the administration period after death until the final payments are made to the beneficiaries.
The Executors are responsible to account to the beneficiaries in the form of estate accounts for all money received into and out of the deceased’s estate.
Stephen Roberts – Private Client Solicitor
Edmondson Hall Solicitors & Sports Lawyers
25 Exeter Road, Newmarket, Suffolk, CB8 8AR
01638 560 556