A detailed guide to probate

The process of dealing with the death of a loved one is usually talked about in emotional terms, and understandably so. But it is also a hugely complex logistical and administrative task that most people are unaware of until they find themselves in the middle of having to cope with it.

The process can become even more complicated if there are potential disputes over the estate, who should inherit, or who should execute the will.

First, it is important to understand that the term ‘probate’ technically refers to being given formal authority to carry out the instructions contained within a person’s will. However, it is also the general term for the process of settling the estate of a dead person by clearing their debts, dealing with issues like Inheritance Tax (IHT) and distributing their remaining assets in line with the instructions they set out in their will.  

In most cases, the application for the grant of probate takes around 3 to 4 months to complete. However, this figure rose during the various pandemic-related lockdowns of 2020/21. The precise timeline for any individual case can vary depending upon the complexity of the estate being dealt with, but you can expect a straightforward estate to be dealt with in its entirety in 12 months.    

In some cases, more than one person will have been named as executor, with people choosing to appoint a close family relative and someone such as a legal representative with relevant expertise.  

If no will has been left and therefore no executor named, then the person entitled to apply for the grant of representation, known as Letters of Administration, will follow the same order as those people entitled to benefit under the Intestacy Rules.  The person or people will need to apply for the grant of representation, enabling them to administer the estate.   

The most straightforward breakdown of the chronological process of dealing with probate is as follows:

• Notify all relevant authorities of the deceased’s death and obtain information to complete the forms needed to lead to the Grant of Representation being issued and to report to HMRC.
• Gather in the assets of the deceased such as money left in bank accounts, shares, property etc.
• Pay off any tax due on the estate and settle all outstanding pre and post death liabilities.
• Deal with what is left of the estate after creditors have been dealt with by:
• Paying any specific gifts in the will; and
• then, distributing the assets in line with the instructions set out in the will.

Is probate always needed?

When the estate’s overall value is viewed as small, which at the time of compiling this guide would generally cover any estate worth less than £5,000, then it is unlikely probate will be needed. It is often the case that different banks will impose their own limit on what it considers to be low value and you may therefore be able deal with more than £5,000 if it is held with particular banks or building societies. In some cases, it is also possible to deal with an estate worth more than £5,000, due to money being held with multiple banks and building societies.

The same applies if the estate involves only jointly owned assets such as property, possessions and money, which automatically pass to a spouse or civil partner. Although it’s always wise to check with HMRC before proceeding, it’s highly likely that estates of this kind will not require probate. You will, however, be expected to evidence to a bank or the Land Registry, the entitlement of the ultimate beneficiary. Even if you do not need to obtain a grant of representation because of assets being owned jointly, pension providers will very often require you to have a grant of representation to pay any monies to you. Therefore, if one of the estate assets is an entitlement under a pension scheme, you may still need a grant of representation.   

The cost of probate

How much probate costs will depend on whether you choose to engage the services of a solicitor or probate specialist to act on your behalf or opt to handle the process yourself.

It probably goes without saying that handling the process yourself is likely to be the least expensive option, provided you do not make any of the potentially costly mistakes. Realistically, the more complex an estate is, the more strongly we would encourage you to call on the services of an expert, even if only to deal with specific aspects of the process.

In either case, there are specific set fees that have to be paid. The application fee for a grant of representation in England and Wales is currently £273 when an estate is worth £5,000 or more.

Extra copies of the grant of representation can be obtained at the current cost of £1.50, and it is probably worth ordering several copies as you are likely to need more than one during the administration process.     

If you work with a probate specialist, the amount you have to pay in legal fees will vary depending upon the complexity of the estate and the way in which their firm calculates the fees.

Some specialists will review the estate assets and, based on their estimation of the amount of work involved, quote a fixed fee for the entire process. Others prefer to work on an hourly rate basis or quote a fee calculated as a percentage of the estate value, plus VAT. Some firms may charge both an hourly rate and a percentage of the estate value, plus VAT.

Handling probate yourself

If you decide to deal with probate yourself, then the best approach and certainly the one most likely to stop you feeling overwhelmed with the scale of the administrative task facing you, is to break the process down into a series of smaller steps as follows.

It is worth noting that a will can be contested at any point, before or after probate has been granted. 

If you are on notice that a claim may be made against the estate, you should not distribute any of the estate assets. If you do so, while on notice, any loss to the person making the claim, could be sought from you personally.

You should also be mindful that executors and administrators owe certain duties to the beneficiaries of the estate so should act in a way which always complies with those duties. Failure to do so could lead to legal action being taken against you, the costs of which could be sought from you personally. This could include attempting to remove you from your position or reimbursing the estate for losses caused by your actions.

You should bear in mind that you should always remain neutral and never prefer your interests of those of one of the beneficiaries, over others. If there is a conflict and you cannot remain neutral, you will have to stand down from your role.

Several copies of the death certificate will be needed as you’ll have to provide one to each institution associated with the deceased’s assets and liabilities. For example, each bank account, credit card or mortgage provider will require a copy. Copies of the death certificate currently cost £11 each.

You need to make an appointment to register the death, so it is best to phone the appropriate registry office in advance. When you go to the appointment, you’ll need to take a medical certificate detailing the cause of death. 

Strictly speaking, this is the only document you must provide, but it would be extremely useful if you could also supply the following documents:

• NHS medical card or number;
• Marriage or civil partnership certificate;
• Proof of address in the form of a utility bill or bank statement;
• Any driving licence held;
• A council tax bill;
• A passport; and
• If possible, the national insurance number of the deceased and any surviving spouse or civil partner.

As stated, the only documentation which is strictly necessary is the certificate detailing the cause of death, so you should by no means delay registering the death while you try to get your hands on the other documents listed above.

Although they may come in useful, they are not essential, particularly since you will also be asked to provide the registrar with the following information:

• The full name of the deceased, including any maiden name in the case of a married woman;
• The date and place of birth of the deceased – if the exact place of birth is not known, then simply the town or county will suffice. The country of birth will only be needed in cases where the deceased was born outside of the UK;
• The address of the deceased;
• The marital status of the deceased;
• The most recent occupation of the deceased;
• The details of any spouse or civil partner, including their name, occupation and date of birth;
• The name and address of the GP of the deceased; and
• Details of any state pension or other benefits.

Before contacting Tell Us Once you’ll need the following information regarding the deceased:

• The reference number provided to you by the Registrar when you registered the death;
• Their name;
• Their date of birth;
• Their address;
• Their National Insurance number;
• The name, address and contact details of the executor or administrator;
• Any driving licence number;
• Any vehicle registration numbers for vehicles owned by them;
• Any passport number and town of birth;
• The date they died;
• The details of any benefits, state pension, tax credits or other benefits which they were receiving;
• The details of any local council services such as housing benefit or council tax reduction which they were receiving and the name of the council providing those services;
• The details of any surviving spouse or civil partner, including their name, address, telephone number and the National Insurance number or date of birth;
• If there is no surviving spouse or civil partner, or that person is unable to deal with the deceased’s affairs, the name and address of their next of kin;
• if they died in a hospital, nursing home, care home or hospice, the name and address of that institution - you’ll also be asked if the stay was for 28 days or more;
• Details of any Armed Forces pension or Compensation Scheme that they were receiving money from;
• Details of any Local Government Pension Schemes that they were receiving money from or paying in to and their National Insurance number; and
• Details of any public sector pension schemes they were in receipt of or paying in to.

Once they’ve been given the relevant information, the Tell Us Once service will contact the following government bodies to inform them the individual has died:

• HM Revenue and Customs (HMRC);
• The Department for Work and Pensions (DWP);
• The Passport Office;
• The Driver and Vehicle Licensing Agency (DVLA);
• The local council;
• Veterans UK; and
• Relevant public sector pension schemes, such as My Civil Service Pension and the NHS Pension Scheme

If the will doesn’t specifically name an executor, then the situation is slightly complicated, but it is still possible to deal with probate. If no executor has been named, then a beneficiary of the estate can apply to the probate registry to act as ‘administrator’ and fulfil the function of an executor.

In cases where no will has been written, then a person is referred to as having ‘died intestate.’ In these cases, the estate of the deceased will be divided in accordance with the rules of intestacy.

In the case of an unmarried or divorced partner of the deceased, the laws of intestacy mean that they do not receive any of the estate. This often comes as a shock to bereaved partners who mistakenly believe in ‘common law marriage’, which they think will see them inheriting automatically in the same way a spouse or civil partner does.  

This is where we often receive enquiries from people looking to contest the distribution of the estate as they have assumed, they would be entitled to something from it. However, the distribution parameters set out in the rules of intestacy or a valid will cannot be contested. Instead, if a person is eligible, they would need to claim under the Inheritance (Provision for Family and Dependents) Act 1975.

The funeral

You can find out from any will that the deceased made, or their paperwork generally, whether they had a pre-paid funeral plan in place. You should contact the relevant funeral director associated with the plan or a local funeral director, if there is no pre-paid plan, to make the necessary arrangements.

In the vast majority of cases, the funeral will take place before the grant of probate has been finalised and the estate dispersed, so if there is no pre-paid plan in place, the executor will have to pay the costs of the funeral and then recover the funds from the estate at a later date.

The Death Notification Service makes it easier to inform multiple financial institutions by providing the following information just once:

• The full name of the deceased;
• The details of the person acting as executor or administrator, if known;
• Details of the deceased’s bank or building society accounts and sort codes and account numbers (these are not mandatory but help the financial institution/s to quickly confirm whether they hold open accounts for the deceased);
• The date of birth of the deceased;
• The date of death;
• The last address of the deceased; and
• The Death Certificate number is also known as the ‘System Number’ and is located at the bottom left-hand side of the death certificate.

Registering with the Death Notification Service means that you’ll receive a confirmation when the relevant banks and building societies have been notified. You can update the number of organisations that the deceased had an account with if you discover more at a later date.

At the time of writing, the following financial institutions were part of the Death Notification Service:

• Bank of Scotland;
• Barclaycard;
• Barclays;
• Birmingham Midshires;
• Cahoot;
• CitiBank;
• Clerical Medical;
• First Direct;
• Halifax;
• HSBC;
• IDEM Servicing;
• Leeds Building Society – excluding Leeds Permanent Building Society accounts;
• Lloyds Bank;
• M&S Bank;
• Marcus by Goldman Sachs;
• MBNA;
• Moorgate Loan Servicing;
• Nationwide Building Society;
• Natwest;
• Paragon;
• Rothesay;
• Royal Bank of Scotland;
• Saga Savings by Goldman Sachs;
• Santander;
• Scottish Widows;
• Shepherds Friendly;
• St James’s Place Bank;
• The Mortgage Works; and
• UCB Home Loans Ltd.  

Having gone through the financial information left by the deceased, you need to ascertain whether other institutions and companies or banks and building societies in addition to those listed above, need to be informed of the situation.

These could include loan and mortgage providers, landlords, pension companies, insurance firms including life insurers, utility companies, companies in which the deceased held shares, the local authority, healthcare providers and employers.

It’s important to contact all the organisations you discover and close any relevant accounts to ensure that you meet your responsibilities as executor, retrieve any money which is owed to the estate, and stop any charges that are still being paid.  

Why you need to contact specific institutions  

Bank or building societies need to be contacted to close accounts, withdraw money held in accounts, pay any outstanding debts, and cancel standing orders and direct debits.

Mortgage providers or other lenders need to be contacted to close the account and pay any outstanding debts.

Insurance companies first and foremost need to be contacted to claim on any life insurance or payment protection insurance (PPI). In addition, you may need to cancel policies such as vehicle, travel and medical insurance once you are sure it is not needed, if the deceased died in any circumstances which might be covered by the policy.

A surviving spouse or civil partner might still need the provision of a home insurance policy which was taken out in the deceased’s name, and it should be relatively simple to contact the provider and have the policy switched to their name.

Student loan companies need to be contacted to cancel any outstanding student loans since repayments end when the recipient of a student loan dies. 

Utility companies such as gas, water and electricity suppliers, need to be contacted in order to close the accounts, clear any debts and reclaim any money owed in credit. If there is a someone continuing to live at the same address as the deceased, they need to contact the utility company to have the ongoing accounts switched to their name.

Landlord or local authority need to be contacted to stop rent payments being taken if the deceased rented a property and, in some cases, to reclaim a deposit that can be added to the estate. The local authority will also need to deal with any council tax which is outstanding or the transfer of the account into the name of anyone still living at the property.

Land Registry need to be contacted if the property was held jointly, and in such a way that it passes by survivorship.

Employers need to be informed in order to ascertain whether the deceased was covered by death-in-service insurance or any other policy linked to their employment which the estate may now be able to claim on.

Set up an estate bank account 

It’s usually possible to open up an executor’s bank account so that you’ve got somewhere prepared for assets to be transferred into when the time comes.

Although none of the funds held in the deceased’s bank accounts will be released until probate has been completed and the grant of representation has been issued (unless the funds were held by providers who do not require a grant of representation), it’s preferable to deal with this relatively simple part of the probate process as promptly as possible. Ideally, if there is more than more than one executor, the bank account should require the signature of at least two executors, to withdraw monies.  

Pay off any debts

Any debts owing when the deceased dies have to be paid, providing there are sufficient funds in the estate. These could include a mortgage, credit and store cards, loans taken out by the deceased and hire purchase agreements.

It should be noted that only the estate of the deceased is responsible for debts in their name, not surviving family members. If there is only enough money left to pay a percentage of the debts then the estate will be considered insolvent. If an estate is insolvent and there is not sufficient money to pay all the debts, you should consider seeking legal advice because it makes the settlement of debts much more complicated. Strict laws state who should be paid; the proportion of any payments; and the order of payment.

In some cases, the assets of the deceased will pass straight to their surviving spouse or civil partner, leaving insufficient funds in the estate to pay outstanding debts. When this happens, creditors have the right to apply for an ‘insolvency administration order’ within five years of the date of death.

If this order is granted, then creditors can force any property or assets automatically inherited by the spouse or civil partner to be sold and the proceeds divided amongst the creditors. For this reason alone, the wisest course of action is for the executor to negotiate with any creditors in order to come to a voluntary arrangement.  

Value the estate

Once debts and taxes have been dealt with, it should be possible to value the remaining estate. Valuing the estate means pulling together everything that the deceased had in savings, pensions, bank accounts, investments, and other assets, including life insurance payments and property value.

Although it’s possible to estimate the value a property yourself, it’s probably wise to seek an independent valuation from an estate agent or surveyor in order to avoid any disputes with HMRC on the issue of IHT.

As well as assets such as property, land, business interests, personal items such as jewellery, art, motor vehicles etc, the value of the estate may also include some insurance pay-outs made after death. You must check with the insurance provider, if the payment falls within the estate, or outside of it. In addition, gifts that the deceased made within seven years of their death may have to be included in the estate’s overall value and this could have an impact on any tax payable to HMRC.

Complete an IHT form

An IHT return will have to be filled in, even if, as the executor or administrator, you’re sure that the estate is too small for any IHT to be due. If the estate is worth more than the current £325,000 tax threshold (known as the Nil Rate Band allowance), then the form which has to be filled in is IHT 400. If the value is lower than £325,000 then it is from IHT 205. Both of these forms can be filed online.

Anyone claiming the additional residence nil rate band (RNRB) – an additional IHT allowance which applies to the estate of an individual left to direct descendants – must complete an IHT400 and IHT435.

If IHT is due, it is currently charged at 40% of any value of the estate above £325,000. IHT normally has to be paid before a grant of representation can be issued and within six months of the month in which the death of the person took place. After this time, penalties and interest will be charged by HMRC.

If there is sufficient money to cover the IHT in the deceased’s bank accounts, then it should be possible to arrange a direct transfer to HMRC. Some specific taxes can be deferred and paid in instalments, such as those owed on assets including land, the value of business interests and some types of shares. If there is only sufficient money to part pay the IHT, it is worth doing this, to minimise the penalties and interest which will be charged by HMRC. To do so, an IHT reference number will need to be obtained and then, money can be paid on account of the anticipated IHT.

If there is insufficient money in the accounts to pay the IHT, then the executor/administrator will have to make the payment themselves if possible and recoup the amount after the grant of probate has been received and the assets of the estate released.

It is also possible to take out a loan to meet the IHT bill, although it should be noted that if the main value in the estate rests in the family home, it may be necessary to sell or mortgage the home to pay back the money owed.   

• IHT form IHT205 or IHT400;
• A copy of the death certificate;
• The original will and three copies; and
• The application fee.

Once the grant of representation has been received, it’s strongly suggested that the executor/administrator advertises in the government’s official public record called the Gazette,– to ask for any unknown creditors to come forward. This notice will cost £70, which can then usually be recouped from the estate, and it acts as insurance to cover the executor/administrator from liability in the case of any creditors coming forward at a later date. After the notice has been placed in the Gazette, you will have to wait for a period of at least two months and one day before the estate is finally divided up. This notice does not serve as protection for any claims challenging the validity of the will or a claim in accordance with the Inheritance Act 1975.

Distribute the estate

Once a grant of representation has been issued, the assets of the deceased can be accessed, and the estate divided, with all debts and taxes having already been paid. If a will was written, then this process should be relatively straightforward. If there was no will, then the estate will be shared out according to the rules of intestacy.

At the time of writing, this means that any spouse or civil partner of the deceased will receive everything up to the value of £270,000. Anything over the value of £270,000 will be divided equally between the spouse or civil partner and any children that the deceased had.

In the event of one half of a cohabiting couple dying intestate, the assets to be distributed will be left to the deceased’s surviving children; parents; siblings; or other relatives depending on the makeup of the deceased’s particular family. The cohabiting partner would not automatically receive anything from the deceased’s estate in these circumstances. In this case, if the cohabitee has been living with the deceased, as husband or wife, in the two years immediately before death, advice should be obtained about making a claim under the Inheritance Act 1975.

More than almost any of the other complex aspects of dealing with probate, the position for unmarried partners on the death of a partner who didn’t leave a will underlines why writing a will is so vitally important. 

There is then a further four months in which a person can decide whether to serve their claim against the estate on the executor (and beneficiaries). For this reason, if you think that a claim may be made against the estate, but you have not been served with court papers, the most cautious approach would be to wait ten months from when the grant of representation was issued, before making any distribution of the estate.

If at any point concerns are raised with you, as executor or administrator, that the will is not valid, you have to investigate those concerns. The validity concerns may be on account of the will not having been signed and witnessed correctly or, more often, due to the deceased not having the capacity to make the will. You may also be asked to determine the circumstances in which the will was prepared. As part of the application process for the grant of representation, an executor or administrator has to effectively promise to the court i.e. the probate registry, that it is the last valid will. If that belief is found not to be true, the court can impose harsh sanctions on the applicant. Therefore, it is strongly suggested that you seek legal advice from a specialist contentious probate solicitor if concerns are raised about the validity of the will or the circumstances in which the will was prepared, to adequately protect yourself.

There are special rules which relate to how the legal costs of an executor or administrator are paid if they become involved in a dispute or court proceedings, on account of their appointment. As mentioned above, you must remain neutral. If a claim has been made at court, you must comply with specific deadlines. Therefore, if there is any suggestion of a claim against the estate, you should seek legal advice.