Most people think obtaining probate is the difficult part of dealing with a loved one’s estate. In reality, it is often only the beginning.
We regularly speak to executors who are surprised by the number of legal and financial responsibilities they take on after someone dies. Whilst some estates are relatively straightforward, many involve issues that families simply do not anticipate. Property may need to be sold, inheritance tax considered, debts settled, pensions traced, investments valued and beneficiaries identified before the estate can be distributed.
It is one of the reasons why administering an estate often takes longer than people expect.
One of the most common misunderstandings is that probate and estate administration are the same thing. They are not.
Probate is the legal process of obtaining the authority to deal with a deceased person’s estate. If the deceased left a valid will, the executors will usually apply for a Grant of Probate. If there is no valid will, the person entitled to deal with the estate will normally need to apply for Letters of Administration.
Obtaining the Grant of Probate or Letters of Administration is an important milestone, but it is rarely the end of the process. In many cases, it is the point at which the real work begins.
The personal representatives must identify and value the deceased’s assets, settle any outstanding debts and liabilities, deal with inheritance tax where appropriate, collect in the estate and ensure that the correct beneficiaries receive their entitlement. Depending on the circumstances, this may also involve selling or transferring property, dealing with investments, business interests and pension benefits, as well as corresponding with financial institutions and HM Revenue & Customs.
Many people agree to act as an executor because they have been asked by a close family member or friend. Few appreciate that they are taking on legal responsibilities that can carry personal risk. Executors have a duty to administer the estate properly and, in certain circumstances, they can become personally liable if mistakes are made. Distributing an estate too early, overlooking creditors or failing to deal with tax matters correctly can all create significant difficulties later.
Another issue we frequently encounter is the expectation that everything will be completed shortly after probate has been granted. Whilst families understandably want matters resolved as quickly as possible, there are often factors outside anyone’s control. A property sale may be delayed, financial institutions can take time to release funds, valuations may be required and tax matters often need careful consideration before the estate can be finalised.
Inheritance tax is another area that is frequently misunderstood. Many people assume that if no inheritance tax is payable, administering the estate will be straightforward. However, inheritance tax is only one aspect of the process. Executors may also need to consider income tax, capital gains tax, lifetime gifts made by the deceased and whether any reliefs or exemptions apply. Taking advice at an early stage can often prevent unnecessary delays and avoid costly mistakes.
No two estates are the same. Some can be administered with relatively few complications, whilst others involve complex assets, blended families, missing beneficiaries, foreign property or questions about the validity of a will. Every estate should be considered on its own facts, and obtaining legal advice at an early stage can help executors understand their responsibilities and avoid problems as the administration progresses.
Losing a loved one is difficult enough without having to navigate unfamiliar legal procedures. Having the right advice can provide reassurance that the estate is being administered correctly, reduce the burden on executors and help families move matters forward with confidence.
Our Private Client team advises executors, administrators and beneficiaries on all aspects of probate and estate administration, including Grants of Probate, Letters of Administration, inheritance tax, wills, estate administration and disputes arising following a death. We provide clear, practical advice tailored to the individual circumstances of every estate.
If you require advice following the death of a loved one or need assistance with probate or administering an estate, please contact our Private Client team on 01708 446781 or by email at mail@mosco.co.uk.
