Applying for a grant of probate? | Read Time 3-5 Minutes.
It is a sensitive topic, but after someone dies, you may be in charge of sorting out their assets (property, money, and other possessions). This process is referred to as “probate”. It is advised to seek legal assistance as a lawyer can reduce the stress and time associated with the process.
If you have been named as an executor in a will, don’t worry; this blog contains everything you need to know about applying for a grant of probate.
What is a grant of probate?
In simple terms, a grant of probate is a legal document required to distribute the estate of someone who has died. A grant of probate confirms the authority of the executor to administer the estate. After the document has been acquired, the executors can sort the legal, tax and administrative duties associated with estate administration.
You are not able to deal with their assets (bank accounts, property, business) until a legal authority to act has been acquired. In England, Wales and Northern Ireland, this is referred to as the grant of probate.
Do I need a grant of probate?
In most circumstances, you will need to acquire a grant of probate to act as the executor of someone’s estate. However, if the estate is valued under £10,000, you will not need to acquire a grant of probate. Furthermore, if the deceased owned everything jointly with another person, the ownership will be transferred on their death.
If you want to distribute someone’s estate without applying for the grant of probate, the executor will need to contact institutions such as investment brokers and banks. This is to inform them that the individual has died by providing a copy of the death certificate.
If someone dies without making a will, the process will be different and require letters of administration. For more information with regards to dying without a will, please visit our blog on intestacy.
Checklist for Grant of Probate
Below we have comprised an applying for a grant of probate checklist to find out exactly what you need to do when applying for a grant of probate. The following headings represent the steps taken when applying for the grant:
1. Register the death
The first step involved in applying for the grant of probate is to register the person’s death. This must be done within 5 days of the death in England, Wales, and Northern Ireland.
Whilst registering the death, it is advised to buy several copies of the death certificate. The cost of each document is £11.00 in England and Wales, and £8.00 in Northern Ireland.
2. Value the estate
After the death has been registered, you will need to sort through the deceased’s personal papers, such as their bank statements, to establish their assets and liabilities and find records of any other accounts they may hold.
For some applying for a grant of probate, their estate may be straightforward, but for others, it can be far more complex, with several investments, properties, businesses, and personal assets.
The following institutions should be contacted:
- Pensions Providers
- The Department of Work and Pensions
- HMRC (to check outstanding tax)
- Local Government (to check outstanding tax)
- Fund managers or stockbrokers
- Mortgage lenders, lender, credit cards and loans
Once you have registered the death, you will receive an identifier for the government’s “Tell Us Once Service”. This service allows you to contact numerous government departments at one time.
You will be required to send a copy of the death certificate to each financial institution that the deceased had an account with. Furthermore, once sent, you should request a final statement from the institution.
After sending the death certificate, the assets will be frozen until a grant of probate has been acquired.
When applying for a grant of probate, an estate may include a property that will need to be valued.
This can be done by yourself by looking at similar house sales in the surrounding area. However, if the property exceeds the value of £325,000, you will be subject to inheritance tax (IHT). If this is the case, a written valuation will need to be completed by either a surveyor or an estate agent. Currently, the threshold, or “nil-rate”, is valued at £325,000.
If the deceased had any other considerable assets such as artwork, cars or boats, the same process would apply.
Estimating the value yourself can lead to complex issues if HMRC challenge that you undervalued the property.
3. File probate applications
The next stage of applying for probate involves filing applications. Once the previous step of estimating an estate’s total value, you will be in a position to complete the probate application form.
The probate application form (PA1P) can be downloaded from the HM Courts & Tribunals Service website. You must sign a statement of trust when declaring that the details you have provided are correct.
When a lawyer is named as co-executor, you will be required to use their probate services. However, if the lawyer is not named a co-executor, you can use your own probate lawyer.
4. File inheritance tax forms
When applying for a grant of probate online, you will need to complete the IHT400 form. In addition to this, you will need to provide the inheritance tax reference and the estate’s total value in the application. Furthermore, the application requires that you upload a copy of the death certification.
HMRC requires both the estate’s value at the time of death and any details of cash gifts made by the deceased in the seven years prior to death. These contributions can increase the estate’s value for inheritance tax purposes and should be accounted for precisely.
Certain circumstances may raise the inheritance nil-rate band. For example, if the deceased was the surviving civil partner or spouse of an individual who died, it is possible to apply for any unused IHT allowance to be transferred from their partner. This can raise the nil-rate band from the initial £350,000 to £650,000.
If you wish to claim additional allowance, executors will have to complete form IHT 217 if the estate is below the IHT threshold. If the estate is above the threshold, the executor will have to fill in form IHT 402, otherwise, the full allowance cannot be claimed.
5. Pay probate fees
In England and Wales, the probate application costs £215 for nearly all size estates. However, if the estate’s total value is less than £5,000, the cost can be reduced to £155 if a lawyer applies on your behalf.
It is advised to acquire at least 5 copies of the grant of probate when purchasing copies. This is because once the application is completed, the cost for extra copies becomes more expensive. Therefore, purchasing them at the initial price of £1.50 will save you time and money in the long run.
In Northern Ireland fees the cost of applying for probate is £220.
6. Pay inheritance tax
The last stage of applying for a grant of probate is to ensure the inheritance tax is paid in advance.
If there are sufficient funds in the deceased’s bank, it may be possible to arrange a direct payment to HMRC. Most commonly, UK banks permit this on a receipt of an IHT 423 form. Furthermore, suppose the estate’s main asset is either stocks or shares. In that case, HMRC will accept inheritance tax in instalments and require a tenth of the total in advance.
HMRC will then review the inheritance tax form and provide approval to finalise the estate.
What happens next?
Provided that there are no complications when submitting your application, you can expect it to take between four and eight weeks to get a grant of probate. After you have been granted probate, you should ensure that you place a deceased estate notice in The Gazette to request any unidentified creditors to come forward. Furthermore, if you avoid taking this step, you may be subject to being personally liable for any of the estate’s unidentified debts. Once this last step is completed, you may begin administering the estate.