Once an Executor or Administrator has obtained Probate the administration of the deceased person’s Estate can begin.
The administration of an Estate can often require a number of different tasks to be completed and the expert team at Eric Robinson Solicitors will assist Executors and Administrators with each and every one of them.
Common tasks include:
Gaining access to the deceased person’s financial assets
Executors and Administrators will need to collect all of the deceased person’s financial assets, which will commonly be transferred to a dedicated Estate bank account.
In some instances every Executor or Administrator may need to be involved in the process of collecting the financial assets. This is because different asset holders, such as banks, have different rules.
Settling the deceased person’s debts and paying any taxes due
An Estate’s Executor or Administrator must pay off any debts or outstanding payments owed by the deceased person. Such debts and payments must be settled before the Estate is distributed to those persons who inherit. Outstanding debts and payments commonly include:
- Utility bills and credit card bills
- Income tax owed
- Benefit overpayments
It is also common for Executors and Administrators to place a notice in local newspapers and The London Gazette to give any of the deceased person’s creditors notice that they need to come forward to claim any sums that they believe they are owed. This process serves so as to protect Executors and Administrators from incurring personal responsibility for any the deceased person’s debts.
Executors or Administrators are also required to calculate and settle any Inheritance Tax payable in respect of the Estate.
Jointly owned property and bank accounts
Money in a joint bank account automatically passes to the other owners. The Executors or Administrators are still required to include this money as part of the Estate when they work out the amount of any Inheritance Tax due.
If the person who died owned a property or other assets along with another person (often known in legal terms as being a ‘joint tenancy’), ownership of the deceased person’s share passes automatically to the other owner. Otherwise, their share goes to the beneficiaries named in the Will.
Distribute the estate
Once all debts and taxes have been paid Estate Accounts will need to be prepared and approved then the Estate can be distributed as detailed in the Will, or by the Intestacy Rules, if the deceased person left no Will.
What is the cost of Estate administration?
Where we are instructed to apply for a Grant, collect, and then distribute assets, we anticipate this will take between 12 and 18 hours of work on average, at our current hourly rate of £260 + VAT (£312). Some of our lawyers are charged at less than this rate and some will be charged at more than this rate.
Total costs are estimated at not less than £3120 to £4680 + VAT (£3744 to £5616).
The exact cost will depend on the individual circumstances of the matter. For example, if there is one beneficiary and no property, costs will be at the lower end of the range. If there are multiple beneficiaries, a property and multiple bank accounts, costs will be at the higher end.
We will handle the full process for you from start to conclusion. This quotation is for estates where:
- There is a valid will, which is produced on instruction by the executors, and does not contain any trusts
- The death has been registered
- There is no more than one property, which is free of any mortgage
- There are no more than 5 bank or building society accounts
- The assets are held in the UK with none held in the Channel Islands or the Isle of Man
- There are no loans or other arranged debts to settle
- There are no other intangible assets such as shares and life policies
- There are between 1 and 4 beneficiaries
- There are no disputes between beneficiaries regarding the division of assets. If a dispute arises, this is likely to lead to an increase in costs
- There is no inheritance tax payable and the executors do not need to submit a full account to HM Revenue and Customs
- There are no claims made against the estate
- It is not necessary to prepare and submit a formal tax return for the period of administration
Disbursements to be added to this fee:
- Probate application fee of £155
- Land Charges Registry bankruptcy searches (£2 per beneficiary)
- Approximately £82 to post in The London Gazette – Protects against unexpected claims from unknown creditors (not always applied for)
- Approximately £110 to post in a Local Newspaper – This also helps to protect against unexpected claims (not always applied for)
Disbursements are costs related to your matter that are payable to third parties, such as court fees. We handle the payment of the disbursements on your behalf to ensure an efficient process.
Potential additional costs
- Where the estate falls outside the scope of work set out above, there are likely to be additional costs that could range significantly depending on the estate and how it is to be dealt with. We can give you a more accurate quotation once we have more information. For example, additional costs may arise where:
- there is no will;
- the estate consists of various share holdings (stocks and bonds), foreign and other intangible assets; and
- there is Inheritance Tax to pay.
- If any additional copies of the grant are required, they will cost £1.50 each (1 per asset usually);
- The cost of dealing with the sale or transfer of any property in the estate is not included.
- The cost of dealing with the setting up and administration of any trusts which arise from the Will is not included.
- The beneficiaries wish to undertake a post death variation
How long will this take?
On average, our experience suggests that estates falling within the range set out above, are concluded within about 6 to 12 months. Typically:
- Obtaining information to enable a Grant of Probate to be made, takes 12 to 16 weeks
- obtaining the Grant of Probate takes 8 and 12 weeks from submission to the Probate Registry;
- collecting assets then follows, which can take between 6 to 8 weeks; and
- once this has been done, we can prepare estate accounts and distribute the assets. This normally takes in the order of 4 to 8 weeks.
This timescale is on the basis that:
- where there is a property to sell, the sale process runs in tandem with the probate administration;
- there is no requirement to correspond with HM Revenue and Customs, other than to seek confirmation that there is no requirement to submit an income tax return; and
- the third parties with whom the deceased dealt, correspond within a reasonable timeframe
Are Fixed Fees Available?
Sometimes executors may wish to instruct us only to obtain a Grant of probate or a Grant of letters of Administration where there is no will. We are happy to accept such instructions on the assumption that no inheritance tax is payable. Where all relevant financial information is provided to us by the Personal Representatives we will obtain the Grant for a fixed fee of £1000 + VAT (£1200) and for this sum, we will:
- provide an initial attendance
- consider all financial and other information provided
- prepare the Return of Estate Information form on form IHT205 for approval and signature (but where the estate requires a full Inheritance Tax Account on form IHT400 to be prepared, which is far more complex, our fixed fee will be £2000 + VAT (£2400))
- where a form IHT400 is required, submit this in advance of the probate application to HM Revenue and Customs
- prepare the application for the Grant
- submit the documentation to the probate Registry
- provide the Grant and office copies to the Personal Representatives
If you require help to ascertain the date of death details of assets and liabilities, we can do this work for you, but our fixed fees will then be £2000 + VAT (£2400) where a Return of Estate Information form (IHT205) is completed and £3000 + VAT (£3600) where an Inheritance Tax account is required (form IHT400).
No other work is included within this fixed fee, leaving you free to obtain all assets, pay all liabilities and account to the beneficiaries entirely by yourself. Where you do require us to undertake additional work, it will be the subject of an entirely separate and bespoke quotation.
Disbursements with Grant only Fixed Fee Work, will comprise only the Probate application fees of £155 and the cost of any Office Copy Grants you may require at the rate of £1.50 per copy.
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