PROBATE
What Do I Do When Someone Dies?
Applying for Probate can be both daunting and time consuming
An Executor will need to
Make an exhaustive list of all the assets and debts including utility bills.- Settle all the deceased’s debts and pay any Inheritance Tax necessary.
- Payment of tax becomes your personal responsibility and may leave you open to personal liability or penalties.
- Arrange for the care of any minor children and pets.
- Locate all the heirs and distribute the contents of the Will.
In Detail
What Do I Do When Someone Dies?
The loss of a friend or loved one can be a very stressful time with many people needing to be notified in the first few days. In addition to the immediate tasks you need to attend to, such as arranging the funeral, there is a lot of paperwork to be dealt with and official documents which need to be completed over the next few weeks.
Let Us help
One of the duties you may have to undertake is applying for Probate. This can often be a complex and extremely time consuming process and needs attending to at a time when you may not feel able to perform this task.
Our Legal Advisers are experts in dealing with all aspects of Probate. Their Directors and Principals are Society of Trust and Estate Practitioner (S.T.E.P.) qualified.
Our specialist Probate Team have a sympathetic and patient approach when dealing with bereaved relatives and will happily arrange an initial meeting free of charge, in the comfort of your own home.
Unlike Solicitors and many other Legal companies who charge an hourly rate, Staff Services Legal Advisers provide a Fixed Fee Probate Service based on the value of the estate, which is quoted in advance of any work being undertaken. This means a considerable saving on the fees you would typically need to pay a high street Solicitor.
As part of our Probate Service our team can also offer you independent advice on the Will itself and may, under certain circumstances, recommend that a Deed of Variation be set up in order to vary the Will. This process would effectively ensure that the beneficiaries of the Will receive as much of their inheritance as possible, protecting it from attack by Care, further Inheritance Tax, Divorce, Creditors and Bankruptcy.
Who do I notify first?
In the first five days it is important that you do the following:
• Notify the deceased’s family Doctor
• Contact a Funeral Director to commence funeral arrangements (you will need to check any Will for any special requests or Pre-Paid Funeral arrangements which may have already been made)
• Register the death at The Registry Office
• Advise any departments who may have been making payments to the deceased, such as Tax Credits, benefits, pensions etc
• You will also need to contact relatives and people close to the deceased.
As soon as possible you should:
•Contact the Executors of any Will to enable them to start the process of obtaining Probate.
• If there is no Will then you should decide who will apply to sort out the deceased’s affairs and apply for Letters of Administration.
Who can deal with the deceased person’s estate?
Usually a close relative like a spouse, child or parent will have the legal right to sort out the estate of the person who has died. In order to be able to administer someone’s estate you normally need to apply to the Probate Registry for a ‘Grant of Letters of Administration’.
If the person who has died leaves a Will
In this case one or more ‘executors’ may be named in the will to deal with the person’s affairs after their death. The executor applies for a ‘grant of probate’ from a section of the court known as the probate registry. The grant is a legal document which confirms that the executor has the authority to deal with the deceased person’s assets (property, money and possessions). They can use it to show they have the right to access funds, sort out finances, and collect and share out the deceased person’s assets as set out in the Will.
What if the person who has died hasn’t left a will – (Intestacy)
If there is no Will, a close relative of the deceased can apply to the Probate registry to deal with the estate. In this case they apply for a ‘grant of letters of administration’. If the grant is given, they are known as ‘administrators’ of the estate. Like the grant of Probate, the grant of letters of administration is a legal document which confirms the administrator’s authority to deal with the deceased person’s assets. When someone dies without leaving a Will, dealing with their estate can be complicated. It can also take a long time - months or even years in some very complex cases.
When a grant is needed
A grant is almost always needed when the person who dies leaves one or more of the following:
• £5,000
• Stocks or shares
• Certain insurance policies
• Property or land held in their own name or as 'tenants in common'
In most cases above, the bank or relevant institution will need to see the grant before transferring control of the assets. However if the estate is small some organisations may release the money to you at their discretion. To establish whether the assets can be obtained without a grant, the executor or administrator would need to write to each institution informing them of the death and enclosing a photocopy of the death certificate (and Will if there is one).The personal representative won't be granted Probate until some or all of any Inheritance Tax that is due on the estate has been paid.
Applies to England, Wales and Northern Ireland. If the person who died lived in Scotland you must apply for a ‘grant of confirmation’.
What is the role of an Executor?
Being the Executor of an estate is not really an honour.
Being an Executor is a difficult and time consuming job.
The role carries some legal liability.
Relatives may be too distressed to perform the role.
Decisions could make them unpopular with beneficiaries.
Appointing an Executor
You should choose an executor to carry out your wishes, as stated in the will. Executors can be beneficiaries under the will and often people appoint their spouse, civil partner or children as executors. Check with your proposed executors that they are willing to take on this role before naming them in your will, as it can involve considerable responsibility. Consider naming more than one executor in case one dies before you.
It may also be easier for the executors if there is more than one person to share the work and the responsibility.
The executors may have to deal with any day to day administration of your estate in the period before it can be distributed. Executors can claim from the estate for expenses incurred in carrying out their duties.
If the estate is large or complicated, there may be advantages in appointing a Professional Executor.
A Professional Executor such as solicitors, accountants or bank managers will charge between 3 and 5% of the value of the estate for the work that they do and often an hourly rate in addition to this. Staff Services Legal Advisers charge only 2% with all fees and disbursements disclosed in advance of any work being undertaken.
Choice of Executors
• Individuals
• Professional people (solicitor, accountant)
• Trust corporation
Where professionals are chosen as executors, they may be appointed as individually named persons or as a firm. Executors like trustees, are in a fiduciary relationship so they cannot make a profit out of their office. They may only claim out of pocket expenses. Therefore, a charging clause must be included authorizing them to charge for all work done by the executors or their firm in administering the estate. There is no legal objection to a beneficiary being appointed as an executor where he or she is the sole beneficiary, or where the estate is small or uncomplicated.
They all have advantages and disadvantages which need to be considered in the light of the circumstances. You should take into account the following:
• Availability
• Suitability
• Willingness to act
• Any possibility of conflict or dispute
• The possibility of predeceasing (a substantial provision should then be made)
. The size, nature and location of the estate, and the extent and complexity of burden placed on executors
. The costs involved
Understanding the Role of an Executor
An executor has to carry out certain tasks in order to legally fulfill the obligations of the task. As executor you should therefore:
• Obtain a copy of the medical certificate indicating cause of death and a formal notice from the doctor if the family members do not wish to do so.
• Register the death at the local Registry of Births, Deaths and Marriages if there are no family members wishing to do so. The death must be registered in order to obtain the death certificate. Nb. It is advisable to get more than one copy as it will be needed when dealing with Insurance companies, pension providers etc.
• Could be responsible for making sure any last wishes such as organ or body donations are carried out. The job might also include planning for the funeral or cremation and arranging for payments for the services provided.
• Make sure you have the last original Will of the deceased. The Testator should have notified you as to the location of this.
• Locate all the heirs. This might seem like an easy task and if there are just a couple of children and they are the only ones named in the Will, it is easy. If there are numerous heirs and they are named in the Will either collectively or individually, the executor must locate each and every one.
• Make an exhaustive list of all the assets of the estate, from personal to real property, to bank accounts, investments etc. and also all the debts including credit cards, utility bills, loans etc.
• It is advisable to open a separate account into which money paid into the estate can be credited. This will prevent estate monies being confused with personal finances.
• Notify all businesses of the death e.g. utility companies credit card companies, banks, council tax offices, social security etc.
• Make sure that all the deceased’s debts are settled before the estate is distributed to the beneficiaries.
• If there are minor or dependent children, the executor could be responsible for arranging for their care and placement. The deceased might have their wishes stated in the Will but if not, the courts might need to be involved in the placement. If there are pets, the executor will need to care for them and make arrangements for their continued care.
• Pay any Inheritance Tax necessary.
•You must declare the value of the estate to HMRC on an Inheritance Tax return, within 12 months of death.
• Payments of the deceased’s tax is your personal responsibility. Failure to submit an accurate account to HMRC may leave you open to personal liability or penalty.
• Contact the local Probate Registry to either obtain the Grant of Probate or the Grant of Administration.
• Distribute the contents of the Will making sure that if anything is to be left to minors, a Trustee has been named.
• After you have completed all of your tasks, you will need to produce a full set of accounts for the beneficiaries showing the estate assets and liabilities, administration income and expenses and how the estate has been distributed.
A key consideration for you will be the extent to which you wish to involve professionals to help and support you in this role.
Our Legal Advisers can deal with the administration of the estate for the later circulation to the beneficiaries if you so desire. In addition we have a clear professional duty of care to explain clearly in advance the basis of our charges, so you know what to expect.
If you are considering asking someone to serve as the executor of your estate, be sure you understand the duties and responsibilities of being an executor. Being the executor of an estate is not really an honor, it’s a difficult, time consuming job that carries some legal liability. An executor will probably work long, hard hours for at least a year or two getting your estate settled and they could quite possibly be a very unpopular person to your heirs.
What is the role of a Guardian?
Guardians take on the role of parent to your children
Failing to name guardians in your Will means that the care of minor children will be decided by the Courts.
You should ensure that those persons you would want to bring up your children are willing to do so.
You should make financial provision for your children to enable their guardians to raise them.
It is best to consider the age of the guardians and to appoint two.
In Detail
Guardians
The role of a guardian is a very important one if you have children. Should you die without making a Will or if you do not appoint guardians in your Will, your children could be placed in care until the court appoints official guardians to look after them. This could take months and would obviously result in distress for your children and other members of your family. You should remember to request that your appointed guardians also make a Will themselves to further safeguard the future of your children.
Who should act as guardians?
You will need to consider who should be the guardians of any children under the age of 18 years who may survive you. The law has certain requirements particularly where the parents are unmarried or have divorced or separated.
Assuming that either parent has the power to appoint a guardian or guardians on their death, it is usual for such appointments to take effect on the death of the second parent.
The normal choice is to appoint family members, particularly where very young children are involved. As children grow the appointment of friends may be more appropriate as they are more likely to share your lifestyle and in these modern times live nearer than your family.
It is usual (but not essential) that the same persons are appointed guardians of all the Testator’s minor children. When the guardians are to act only after the death of the surviving parent it is desirable that each parent should appoint the same persons to act as guardian. It is, of course, important that the Testator should obtain the consent of the proposed guardian before making the appointment.
Although each parent can appoint different guardians, it is worth remembering that both will legally act in the event of your death so depending on who you have chosen, will impact on your children’s future. You can also appoint different guardians for different children but this may mean splitting them up. Guardians have to ensure adequate contact between the children is maintained but you may not be happy having your children divided in any way.
Who cannot appoint guardians?
Unmarried fathers who don’t have parental responsibility cannot name guardians, neither will they necessarily become guardian should the mother die. If they wanted to ensure that they did, it would be necessary to enter into a written agreement to share responsibility with the mother, or apply to the court. It would be possible for unmarried fathers to become guardians if appointed by the mother or by marriage.
How many Guardians?
Where the appointment of family members is being considered care needs to be taken when considering appointing a ‘committee’ of relatives. The obvious disadvantage with a committee is that the well being of your children may be overlooked and a committee can be difficult to manage. It is best to limit the maximum number of guardians to two and it is preferable that they share a home as partners. Thus your children will become part of a familiar and stable environment at probably the most difficult time of their lives. By all means appoint substitute guardians as this will ensure continuity if circumstances change.
The Guardian’s duties
The duties of a guardian are essentially the same as those of a parent. They are responsible for the day-to-day upbringing of your child including holidays, birthday presents and all the everyday things that we take for granted. The terms of the Will should be such that the executors and subsequently trustees can do all that is necessary to assist in financial terms.
The Implications
The role of the guardian is a very responsible one and should not be entered into lightly. There will be financial, social and emotional implications taking on such a vast role and the matter should be discussed in detail between the Testator and the appointed guardians.
Many parents will provide financial support for their children in the event of their death and although it may seem insensitive to question them about this, it is a factor in making your decision. You may be able to claim child benefit and receive a guardian’s allowance in the event that both parents are deceased. Where one parent is alive and you are still called upon to act as guardian the situation will obviously be more complicated.
There are circumstances under which the guardian will be called upon when both parents are not deceased in cases where:
- A surviving parent is unable to perform their role because they are overseas, in the army, in prison, disabled or mentally incapacitated, or after the death of the first parent, or they just refuse responsibility.
- A couple are separated or divorced and just one of the parents die. The guardian will act with the surviving parent and should disputes arise they will have to be settled by the court. The surviving parent is still considered the statutory guardian.
Financial considerations
It is normal for the financial management to be separated from the day-to-day upbringing of children. Whilst the guardians have the daily responsibility it is better for the financial control to be handled by someone different, normally the Trustees of your estate. The two tasks demand different skills that may not always be found in the same person. It also means that the Trustees, the guardians and, when they are old enough, your children, can share what can be difficult decisions.
In your Will, where your children are underage and are to benefit from your estate, you should nominate them as the beneficiaries. In no circumstances should you nominate the Guardians
– as mentioned above, the money will be held in Trust, and will be controlled by the Trustees for the benefit of the children.
The appointment of testamentary Guardians for children allows you to decide who should be responsible for your children’s welfare, maintenance and education, and how these should be funded if both your deaths occur while any child is under 18 years of age.
There is no legal reason why you cannot appoint the same people as Executors, Trustees and Guardians if you wish, but you should be aware that there is a potential conflict of interest in that the Trustees are responsible for advancing sums of money held in Trust to the Guardians to help with guardianship duties. However, if you have absolute trust in the people appointed then do not allow this to concern you.
Do consider factors such as the age of your Guardians, where they live in relation to you, (would children have to move school etc.), how close is the relationship between your Guardians and children now, and do your Guardians know and share your views on how your children should be raised and educated etc.
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