PROBATE WORK & FEES

LILLYWHITE WILLIAMS & CO SOLICITORS

PROBATE WORK AND FEES

What is a Grant of Probate?

A grant of probate is a legal document that is sometimes needed to access bank accounts, sole assets and settle debts after someone has died.  This document is called a grant of probate if there is a Will or a grant of letters of instruction if there isn’t a Will.

When is Probate required?

Whether probate is needed depends on what the person owned when they were alive.  If they owned a property in their sole name, or had other high value assets, it is likely probate will be needed to deal with their estate.

How does the Probate process work?

The probate process often involves a lot of complicated legal, tax and financial work which can be broken down into 5 different phases.

Phase 1: Identifying all of the deceased’s assets such as property investments and possessions and all of their liabilities such as debts ranging from loans to bills in order to determine the value of their estate.  At the same time, verifying who is entitled to inherit what from the estate, whether under the terms of the Will, or in accordance with the rules of intestacy if there isn’t a Will, and obtaining the necessary identification documents for those beneficiaries.

Phase 2: Paying Inheritance Tax to HM Revenue and Customs where applicable and submitting the Inheritance Tax return.  Then applying to the Probate Registry for the grant of representation.  This is a document confirming who has the legal authority to administer the estate.

Phase 3: After the grant of representation has been issued by the Probate Registry, liquidating (selling) the deceased’s assets, settling their liabilities, paying the final estate of administration expenses and accounting to HMRC for any further inheritance tax, income tax or capital gains tax due to or from the estate.

Phase 4: Preparing estate accounts for all payments in to and out of the estate and showing the balance left for distribution to the beneficiaries.  Sending the estate accounts to the personal representatives (such as the executors in the Will) for approval. 

Phase 5:  Providing there are no challenges to the estate or other complicating factors that prevent distribution, the final phase will involve transferring assets to the beneficiaries (if they want to keep these) and distributing the balance of the estate in line with the terms of the Will or the rules of intestacy. 

How long does Probate take?

The probate process usually takes 9 to 12 months to complete.  This can vary depending on several factors such as complex inheritance tax situations, lengthy property sales or difficulty in identifying or contacting beneficiaries.  The collection of assets and distribution of the estate can take another 3 to 6 months depending on how long it takes for HMRC to respond to enquiries and the necessary steps involved in selling any assets.

What is a personal representative?

A personal representative is another name for someone who is an executor or, if there is no Will, the person who has legal authority to administer the estate.

Whose responsibility is it to get Probate?

If the person who died left a valid Will, it will name one or ore executors and it is their responsibility to apply for probate.  If there isn’t a Will, the inheritance (intestacy) rules will determine whose responsibility it is to obtain probate.

Do I have to act as executor if I am named in the Will?

You do not have to act as an executor. You can give up all rights to act as executor as long as you haven’t undertaken any work on the estate administration.  If there are other executors named in the Will you can choose to have your rights reserved which allows the other executors to act but you can apply to join in the probate process later on if you want to or need to.   You can also choose to instruct a probate solicitor to complete the probate work for you.

If you act as executor, it is important that you understand the duties and responsibilities of an executor.  If you make any mistakes you could be held liable for these.

What happens if I don’t apply for Probate?

If you don’t apply for probate when it is needed, the deceased’s assets cannot be accessed or transferred to any of the beneficiaries.  Probate gives a named person the legal authority to deal with the assets.  Without this authority they cannot do anything.  This includes closing down bank accounts, selling or transferring property, transferring pensions and cashing in other investments.  Essentially, the assets will remain in limbo and the beneficiaries won’t be able to receive their inheritance. 

Not obtaining probate when it is needed can also cause problems for family and friends in the future.  For example, someone who has lost their spouse may believe probate isn’t needed because everything was owned in joint names but it later turns out that the house was actually owned in their spouse’s sole name.  When that person dies, the person administering their estate will have to deal with the probate on their late spouse’s estate first.  This could cause significant delays and increase the cost.

PROBATE PRICING

Probate application only

Our fees are normally based on an hourly charge rate of £350 per hour exclusive of VAT for a solicitor with more than 10 years’ experience.  However, in the most straightforward of cases we may be able to quote a fixed fee or provide an estimate of our likely costs.  Any fee whether estimated or fixed that is quoted will also provide a list of any disbursements (expenses) that will need to be incurred.

An average fee in this category would be in the region of £3,000 plus VAT and disbursements.  The work undertaken would include:

      a. Identifying the type of probate application you required.

      b. Completing the probate application and relevant HMRC

         forms.

      c. Liaising with HMRC in respect of any IHT due. 

      d. Making the application to the Probate Registry on your

         behalf.

You as the Executor or Administrator would need to liaise with the financial institutions to obtain the information required for the probate application.  We would then use this information to prepare the tax forms and documents required.  Once the grant is obtained our retainer would end and you would then deal with collecting and distributing the estate assets and settling any debts of the estate.

Full estate administration – applying for the grant and collecting / distributing the assets

Our fees are normally based on an hourly charge rate of £350 per hour exclusive of VAT for a solicitor with more than 10 years’ experience.  However, in the most straightforward of cases we may be able to quote a fixed fee or provide an estimate of our likely costs.  Any fee whether estimated or fixed that is quoted will also provide a list of any disbursements (expenses) that will need to be incurred.  As a general guide, an average fee would range between £6,000 and £9,000 plus VAT and disbursements.  High value estates with more than one property, many beneficiaries or assets – up to £20,000 plus VAT and disbursements.

Disbursements

Disbursements are expenses relating to your matter that are payable to third parties such as Land Registry fees.  We handle the payment of the disbursements on your behalf to ensure a smooth process.  Since these costs are payable to third parties they are outside of our control.  The following is a list of disbursements which are most likely to arise:

Probate application fee (for all estates with a value exceeding £5,000) - £273-£280.

Land Registry search fees £3.00 per title

Statutory Notices (if required) £200-£300

Will search (if required) £418.80 inclusive of VAT

Dormant account search (if required) £222 inclusive of VAT

Bankruptcy searches (if required) £2 per name

Person undertaking probate work

All our probate work is undertaken by solicitor Mr Harjit S Kang, a solicitor with over 30 years’ experience, email HSK@lillywhitewilliams.com