Probate is a term often used to describe the process of administering someone’s will (their ‘estate’). In fact, it is the court order made by the Probate Registry which gives the executors of the will the authority to deal with the administration of the estate. Without the ‘Grant of Probate’, your executors will not be able to get on with dealing with your will when you die.
In simple terms, the process of probate (or administering a will/estate) can be summarised as:-
- NOTIFICATIONS – notify people such as DVLA, and clubs or memberships you have, and so on
- VALUATIONS – they will have to register your death with all ‘assets holders’ and liabilities companies to get date of death valuations. This is needed both to apply for probate, and pay any inheritance tax (IHT) that might be owing
- PAY INHERITANCE TAX (IHT) – if your estate is liable to IHT it needs to be paid before probate can be granted
- APPLY FOR PROBATE – this is done by an application to the Probate Registry and can now all be done online
- CASH IN ASSETS & PAY BILLS – this might include bank accounts, and even clearing and selling your house
- PAY LEGACIES – if your will has fixed cash legacies then these must be paid as soon as your executors can (not all wills have fixed cash legacies)
- PAY RESIDUARY ESTATE – this is the bulk of your estate and it can include one or more ‘residuary beneficiary’. If there is more than one person benefitting from the residue of your estate in your will, then the will must specify what percentage shares each beneficiary is to receive
- SETTLE YOUR INCOME TAX – your income tax affairs must be settled in two sections; (1) to the date of your death – ie your lifetime income tax; and (2) for the ‘period of administration. If the estate administration straddles more than one tax year your executors may have to submit a tax return for each tax year concerned. Getting ‘sign off’ from HMRC on income tax can unfortunately take months
- ESTATE ACCOUNTS – other than in simple cases you would expect your executors to provide the beneficiaries with regular updates, and provide estate accounts at the end of probate (detailing everything that has happened including confirmation of all money in and out of the estate)
The administration of an estate is likely to take 12 months or more – even for a simple estate. If there is a house to sell, this alone takes months even in ‘normal circumstances’ (ie when we are alive).