Vive Kumar Singh, Author at Probates Online

Best Guide to Transfer Ownership of a Property after Death in the UK

Posted on April 14, 2022 by Vive Kumar Singh

When a relative or friend dies, there may be a property that is part of the estate which has been left in the will to a beneficiary or needs to be sold. The property’s ownership will need to be transferred to either the co-owner, usually a spouse or civil partner, if in both of their names, transferred to the new owner if being sold, or transferred to the beneficiary.

Transferring ownership is changing the name of the owner on the property’s Title Deeds. Different situations, such as whether there is a will or not, and whether the property is tenanted, require different documentation. Here are the steps you need to take to transfer ownership of a property after death.

Transferring a property with or without a will

To transfer ownership of a property after death to a new name is known as a title transfer. However, the process depends on whether the deceased left a will or not. If there is a will, the title transfer will be handled by the executor(s) of the will according to the deceased’s wishes when they have received a Grant of Probate. If there is no will, the Rules of Intestacy will apply, which detail who is allowed to inherit from the estate, and thereby the property, i.e. succession laws, but this cannot happen until Letters of Administration have been granted by the court and an ‘administrator’ appointed.

To transfer the ownership, the executor(s) or administrator of the estate needs complete two forms that are sent to Land Registry, which are:

Form AS1 – this form represents the whole of the registered property title and confirms that you, as executor(s) or administrator(s) of the deceased’s estate approve the transfer of the property to the beneficiary, or beneficiaries.
Form AP1 – this form is the Change of Register that the Land Registry uses to complete the transfer.
Form TRI – if the property is being sold, this form is used by conveyancers to transfer ownership of the property to the buyers. This form registers the property with the Land Registry. However, if only part of the registered title is being transferred, i.e. to a new joint owner, use Form TP1.

A certified or sealed copy of the Grant of Representation – which is the Grant of Probate or Letters of Administration, a copy of the official death certificate and, in some cases, a copy of the will – must also be sent to the Land Registry with the forms.

Whilst you don’t necessarily need a solicitor to transfer ownership of a property after death, once the new title deeds of the property have been issued by Land Registry, you will need a notary – a qualified lawyer specialising in property law or probate – as they will need to ‘notarize’ the new deeds. Essentially, they act as a legal witness to you signing the deeds, and any accompanying documents, and once signed, they will add a seal to your title deeds indicating the signature is official and legal.

Transferring ownership of a property in joint names

If the property is owned with another person, usually a spouse or civil partner, the property is automatically inherited by the surviving spouse/civil partner, which is called the Right of Survivorship. Although the property’s title deeds already have the joint owners’ (joint tenants) names on the deeds, you will still need to notify the Land Registry of the change in circumstances using the Deceased Joint Proprietor form. This will need to be sent to the Land Registry along with a copy of the official death certificate.

If there is a mortgage on the property, whoever inherits the property also inherits the mortgage. In this situation, the beneficiary must get permission from the mortgage provider to transfer the property into a sole name. They will assess your ability to pay the mortgage repayments before granting permission.

The property may have been owned by joint owners whereby each owner had a share in the property. Known as Tenants in Common, one owner is entitled to leave their share of the property to someone other than the other joint owner, or in accordance with the Rules of Intestacy if there is no will.

Is there a cost to transfer ownership of a property?

Yes, there is a minimal charge to transfer the ownership of a property after death. In some cases, a stamp duty tax is also applied if the property is valued at over £125,000. The costs involved are:

Land Registry fee – how much you pay Land Registry to transfer the property into a new name depends on the circumstances, but it is currently £40 minimum.
Joint owners fee – for those that are going to be joint owners of more than one property, i.e. the beneficiary already jointly owns one property and the transferred property will also be jointly owned, there is an additional Land Registry fee of up to £150.
Notary’s fee – you will also need to pay the notary for witnessing your signature, sealing and notarizing the new title deeds of the property. How much you pay will depend on the notary or complete package service you use.
Register the deed – following notarization, you may have to pay another small fee to the Land Registry to officially register the title deed with them.

There is no law to say that you must remove the deceased’s name from the title deeds of inherited property. However, it is recommended to keep the Land Registry up-to-date with any changes of ownership to ensure any future transactions with that property are accurate; for example, if you wanted to sell the property at a later date, transferring ownership to the buyers will be a simpler process for the conveyancers. It is also a good way to avoid being the victim of any scams or fraudulent activity as the Land Registry will be able to track the accurate ownership of the property.

At Probates Online, we offer a complete property title change of ownership service including acting as a notary of the titled deeds. We also provide a will writing service or a Complete Estate Service to help you through the probate process and estate administration upon the death of a loved one. If you are looking for advice on inheritance tax, gifts or trusts, or need to apply for Grant of Probate, Letters of Administration or would like to take advantage of our entire Estate Administration service, visit our website for more information or contact us today.

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Where to Find the Online Probate Application & How to Apply for Probate

Posted on April 5, 2022 by Vive Kumar Singh

When someone dies and leaves a will, it is the duty of the deceased’s family, solicitor or executors to officially apply for authorisation to administer the deceased’s estate. Whether the estate is valued below or above the Inheritance Tax threshold, grant of probate is still required.

If the deceased did not leave at will, a family member or solicitor will need to apply for letters of administration, which comes from the court, which gives that person the authority to administer the estate of the deceased.

You can apply for Online Probate Application via the government’s MyHMCTS platform, whether it is grant of probate or letters of administration, although you will still be required to send the relevant documentation by post.

Applying for probate online

MyHMCTS (HM Courts & Tribunals Service) was established in 2018 as part of the courts reform and to speed up the probate process when someone dies. Using the MyHMCTS service provides for a simpler, online method to apply for probate by either family members or executors of a deceased, as well as by legal probate specialists. Since its inception, around 30,000 probate applications have been submitted; 4,466 probate specialists have registered to use MyHMCTS and 92% of users have been satisfied or very satisfied with the service.

You can use MyHMCTS to make probate applications that fall under:

Deceased’s estates that have a will (grant of probate).
Deceased’s estates without a will (letters of administration).
Deceased’s estates with an annexed will (letters of administration).

In some cases, it is not possible to apply for probate online, such as:

It is a second grant of probate application for the same estate.
When there is a foreign will.
When the application is accompanied with a document to prove a copy of the will.
When the person applying for grant of probate or letters of administration is under the age of 25 years.
When the probate application is related to resealing under Colonial Probates Acts 1892 and 1927, under rule 39.

How to apply for probate online

Before you or a professional is able to start the online probate process, there are several steps that need to be taken first. You will need to:

Create a MyHMCTS Payment by Account in order to pay the probate application fee. Currently, the fee is £273 for estates that are valued in excess of £5,000. For estates valued below this figure, there is no fee, unless it is a second grant pertaining to the same estate when a £20 fee is charged.
If you are a probate specialist working for a firm, you will need to register your firm with MyHMCTS before you can proceed.
You will also need to set up your MyHMCTS user account.
If the deceased’s estate is valued over the current Inheritance Tax (IHT) threshold of £325,000, you will need to complete forms IHT400 and IHT421 (depending on circumstances) and send them to HMRC. You will not be able to apply for probate online via the MyHMCTS platform for 20 working days. This is because the Probate Service needs to wait for HMRC to send them the completed IHT421 form.

Once you have completed the above steps, and waited 20 working days (if applicable), you will be able to sign in to your MyHMCTS account to create a probate case following these steps:

Start your online probate application by clicking on ‘Create Case’. From the drop down menus, select the Jurisdiction, i.e. ‘Manage probate application’, choose the case type, such as ‘Grant of representation’ and then select the State. Once completed, click on ‘Start’.
You will be asked for your organisation’s details, i.e. whether you are a probate practitioner. If you answer no to this question, you will then be prompted to name the executor – only answer yes to this question if there is a will and the person applying has been named in the will as an executor – or to name the person acting as an executor as part of an appointed firm or trust nominee. If none of the above apply, select no.
You will now be asked to complete the deceased’s details, including their full name on the death certificate, their date of birth and date of death, their permanent address at the time of their death and whether they had any assets in another name.
On the next screen will be the details in respect of Inheritance Tax and the forms completed, depending on whether the deceased died before 1^st January 2022 or after this date. If the date of death was after 1^st January 2022, new regulations mean that you may have had to complete different forms
You will be asked which probate application you are making, i.e. grant of probate or letters of administration, and then enter the relevant details. Each type of application has a different set of questions and you will be taken through a set of different screens to add all the information.
Once this is completed, you will be required to review a legal statement and declaration (you can change this if required). Once happy, send to other executors (if applicable) to digitally sign, unless you are authorised to digitally sign on their behalf.
You will then be asked to pay the probate fee and if you require additional copies of the grant of probate/letters of administration. It is always a good idea to purchase a few extra copies at £1.50 each. Then submit your application.

Although you have applied for probate online, you will still need to send physical documents to MyHMCTS for them to verify your application. These documents include:

The original will (if there is one) or annexed will.
The coversheet from your online application – you will need to print this – that details your probate application reference number. If you don’t have a printer, write the reference number of a sheet of paper.
IHT205 and IHT217 inheritance tax forms if the estate is below the value of £5,000.
A copy of the signed legal statement and declaration.

Always make sure you keep copies of the documents you are sending and despatch using Royal Mail’s recorded delivery service. If you are sending a notarial copy or a court-sealed copy of the will, you will need to send a cover letter as well that details where the original will is being kept and the reason why it is not being released. Your probate application should be completed within 8-12 weeks.

At Probates Online, we offer a will writing service or a Complete Estate Service to help you through the probate process and estate administration upon the death of a loved one. If you are looking for advice on inheritance tax, gifts or trusts, or need to apply for Grant of Probate, Letters of Administration, or would like to take advantage of our entire Estate Administration service, visit our website for more information or contact us today.

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Documents Required When Applying for Probate in 2022, in the UK

Posted on March 24, 2022 by Vive Kumar Singh

Applying for grant of probate when someone dies is a legal process and as such, certain documents are required. As well as the probate forms, there is other documentation that needs to be sent to the Probate Registry, as well as to HMRC, banks and building societies, utility companies and insurance companies.

The probate process is currently taking 10-12 weeks in the UK, but it can take longer depending on the circumstances, such as whether there is a will or not, the size and complexity of the deceased’s estate, and the right documentation being completed and submitted on time.

How to apply for a grant of probate?

You will need to apply for grant of probate within 6 months from the date the deceased died which gives executors of the deceased’s will the authority to manage their estate. But first, let’s give you an overview of how to apply for probate. Due to the recent coronavirus pandemic, you are now able to apply for probate online. Which forms you complete digitally depends on whether the deceased left a will or not, and whether the person applying is the executor or a relative of the deceased.

However, even if you apply online to the Probate Registry, you will still need to collate and send in the post (or take by hand if that’s possible) the relevant documents required for probate.

Documents required to apply for grant of probate online

The grant of probate is a legal document from the court that authorises the executor(s) to administer the deceased’s estate. An executor is not allowed to proceed with estate management without this documentation so the sooner you can apply for it, the better. To apply online, you will need the following documents with you:

Death certificate – you will need a copy of the death certificate, or coroner’s certificate, that confirms the date of death.
Deceased’s will – you will need a copy of the original will, as well as any codicils (these are additional changes to the deceased’s will), and any lists or other documents referred to in the will. The executor(s) will also need to initial the original will before they apply for probate.
Inheritance tax return – you will need to submit a completed and signed inheritance tax return. This doesn’t mean that inheritance tax must be paid before you apply for probate, but it does mean that the form should be completed and signed by the executor(s) or the person acting on behalf of the estate.
Photographic ID – to confirm your identity, you will need a certified copy of your photographic ID, such as a passport or driving licence.
Application form – this is only necessary if you are applying for probate by post (or in person). It is worth getting the completed application form checked by a probate specialist to ensure that it is accurate. Any errors or missing information, such as a signature, will mean that the probate application, and therefore process, will be delayed.
Court fee – you will need to pay a fee to apply for probate, which is currently £275 if the value of the estate is estimated to be over £5,000. For any estates that are lower than this value, there is no fee charged. It is always recommended to get extra copies of the grant of probate, which are charged at £1.50 per copy, so you can send a copy to other organisations that ask for it.

As well as this documentation, there is specific information you will need to know to complete the grant of probate application. These details are:

Whether the person that has died had a will made outside of Northern Ireland.
The marital status of the deceased.
Details of the assets held by the deceased in the UK and abroad, including Northern Ireland.
Confirmation the deceased’s name is on the title deeds of the property, or properties, if a property was owned by the deceased.
Whether all the named executors are applying for grant of probate. Executors are entitled to renounce or reserve their power. If an executor has died prior to the deceased’s death or grant of probate, this can be detailed in the application.
Whether the executors named in the will have sufficient mental capacity to apply for probate and administer the deceased’s estate.
The names, occupation and addresses of all the executors (or administrators; if there is no will, a relative or friend of the deceased will need to apply to the court for letters of administration, naming them an administrator who can manage the estate) applying for grant of probate.
The mobile number and email addresses of all executors or administrators applying for grant of probate, if applying online.

In some cases, other documents may also be needed, such as:

Executor(s) renounce or reserve of power forms.
A certified copy of Foreign Grant or Foreign will if any foreign assets in the deceased’s estate, or the will itself, is outside the UK.
Registered Enduring Power of Attorney.
Completed Power of Attorney form.
A certified copy of the Controllership Order.
Any court order that has been made in respect of the deceased or their estate, such as the appointment of an administrator.

You can also apply for grant of probate by post by downloading the relevant forms, depending on whether there is a will (Form NIPF1) or no will (Form NIPF2), completing them and sending to the Probate Registry office in London together with all of the above relevant documents. Again, if you’re not sure about any information you’ve used to complete the form, and to make sure it is accurate, ask a probate specialist to check. It is always recommended to send the application and related documents by registered or recorded post for safety.

At Probates Online, we offer a will writing service or a Complete Estate Service to help you through the probate process and estate administration upon the death of a loved one. If you are looking for advice on inheritance tax, gifts or trusts, or need to apply for Grant of Probate, Letters of Administration or would like to take advantage of our entire Estate Administration service, visit our website for more information or contact us today.

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Benefits of Using a Will Writing Service in 2022 in the United Kingdom

Posted on March 13, 2022 by Vive Kumar Singh

The pandemic over the past couple of years has certainly highlighted the need to have a will written that details who will be administering your estate should you pass, and who you would like to receive your estate.

Whilst it was reported that there had been a 75% increase in the number of enquiries about a will writing service, new research shows that 61% of adults in the UK do not have a will – that equates to around 30 million people.

The reasons for not having a will are varied, such as cost or the belief that they don’t need a will. But one of the top five reasons is because people don’t know where or how to start writing their will. This is where a will writing service can help you understand your assets and know what needs to be considered in your will.

Why do I need a will?

Let’s start with a question we hear regularly, why do you need a will? Whether you’re in your 20s or 50s, the importance of writing a will is the same. A will can help ensure your loved ones are protected and your estate is dealt with in the way you wish upon your death.

A will is a legal document that sets out your wishes, from the type of funeral you’d like to how you want your estate handled, who raises your children, as well as who inherits your possessions and assets. Because it is a legally-binding document, it is important that it is set out and prepared correctly or it could be considered invalid and your family may be in the position of being unclear of your wishes.

The main reasons for making a will are:

To ensure your family and/or children are financially provided for when you die.
To name a guardian for your children if they are under the age of 18 years.
To provide for other dependents, such as step-children. The law states that only spouses or blood relatives may automatically inherit if there is no will.
To protect your partner if you are not married. The law does not take into consideration the length of time you have been together.
To protect your family home. If it is in your name, your partner (if not married) and any step-children are not automatically entitled to inherit the property.
To avoid family disputes – this may happen if there is no will or if the will is not clear and is contested.
To avoid your family paying too much inheritance tax on your estate.
To protect a subsequent family should you divorce and remarry. It must be remembered that just because you are divorced, this does not override your will so your ex-partner could still inherit from your estate.
To make your own decision on who administers your estate, i.e. your executor(s), although it is only fair to ask them in advance of naming them in your will.
To express your wishes on who looks after your pets and ensure they are provided for.
To protect any digital assets you may have, which also includes your email and/or social media accounts – you can set out your wishes, such as protect the information or have them deleted/destroyed.
To leave a gift in support of your favourite charity.

Why use a will writing service?

Of course, you are entitled to write your own will; will writing packs are available to buy. However, if you want to make sure that your will is written and prepared correctly, or if you have a large, complex estate, it is highly recommended that you use a will writing service.

There is a general misconception that only a solicitor is able to write a will on your behalf. In reality, that’s not true. An accountant is also able to write a will or you can use a specialist professional will writing service, particularly if you’re not sure how wills work or what needs to be included.

There are a variety of benefits to using a will writing service including:

Will writers are there to provide professional advice and support as well as answer any queries you may have.
Ensure your will is legally binding to avoid any disputes between members of your family, including making sure it is signed and witnessed correctly.
Prompt you when it is time to review and/or update your will should your circumstances change. People’s situations change as they grow older so, it is a good idea to review your will on a regular basis to make sure it still reflects your wishes, is still valid, and encompasses all of your estate.
To make sure your will abides by any recent changes to rules and regulations surrounding wills and estate planning, such as the way inheritance tax is reported from 1^st January 2022, the rise in the cost of the probate fee, and the rules around remote witnessing of wills which is no longer allowed.
Provide advice on who to choose as your executor(s) or they are able to take on the role of executor of your will, thereby avoiding any conflict of interest should your executor also be a beneficiary.
They are able to better manage and advise on how to write a will for large, complex estates including overseas investments and business assets.
Ensure that all areas of your estate have been considered including any funeral instructions, gifts to charity, your beneficiaries, care of your pets, guardians for your children and any smaller, more sentimental items.
They are able to look after your will, as well as important documents, such as title deeds, or know where they can be found.
Help you determine a value for your estate’s assets, such as cars, property or art, should it be needed for tax purposes.

You might think that because you are young, unmarried and have no children that you don’t need a will. However, you still have assets; like a car, jewellery, possessions, money in the bank, insurance policies, a pension and possibly a life insurance policy, too. By ensuring you have a legally binding will written by a will writing service, you can be sure that your wishes will be adhered to should you die. If you are older, are married and do have children, the sooner you make a will the more peace of mind you have.

At Probates Online, we offer a will writing service or a Complete Estate Service to help you through the probate process and estate administration upon the death of a loved one. If you are looking for advice on inheritance tax, gifts or trusts, or need to apply for Grant of Probate, Letters of Administration or would like to take advantage of our entire Estate Administration service, visit our website for more information or contact us today.

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How to Value an Estate for Inheritance Tax and Report Its Value

Posted on March 1, 2022 by Vive Kumar Singh

When someone dies and the executors of the deceased’s will apply for probate, or relatives apply for letters of administration if there is no will, part of the process is to determine whether any Inheritance Tax (IHT) is due to be paid.

To calculate the inheritance tax value, the deceased’s assets and/or debts need to be identified and confirmed, their estate needs to be valued and this figure needs to be reported to HMRC. However, if the deceased’s estate is valued below the IHT threshold, which is currently £325,000, no tax will need to be paid. But the value still has to be reported to HMRC to confirm nil tax.

If there is tax due, the IHT forms must be completed within one year and the tax must be paid, or part paid, within six months of the date of death. If you’re not a solicitor, it can be difficult to understand how to value an estate for IHT purposes and which forms to complete to report the estate’s value to HMRC. So, let’s look at this in more detail.

Why does a deceased’s estate need to be valued?

There are several reasons why a deceased’s estate must be valued:

To complete the probate application.
To determine if IHT is due and if so, how much must be paid to HMRC.
To determine if any individual assets are subject to Capital Gains Tax (CGT), if they have increased in value since the date of death.
To ensure any debts are paid before the estate can be distributed correctly and according to the deceased’s wishes.

IHT is paid on the net estate value i.e. after all debts, including funeral expenses, have been deducted and only if it is above the IHT threshold. Once this has been determined, the net inheritance tax value is reported to HMRC to calculate whether any tax is due and, if so, how much.

New regulations were introduced by HMRC in January 2022 that not only simplify the reporting process, but also increase the thresholds. This means that more of a deceased’s estate will be exempt from tax liabilities.

The IHT threshold is currently £325,000, which hasn’t changed. This figure needs to be deducted from the estate’s total value before calculating any tax liability. There may also be other tax exemptions, such as the residence nil rate band tax allowance (it could be double the IHT threshold) if the deceased’s home or some of their estate is bequeathed to their children or grandchildren.

The new changes to threshold limits mean that any part of the estate left to a living spouse or a registered charity is exempt from IHT as long as the estate is valued at less than £3 million. In addition, any assets held in a trust or a lifetime gift (as long as the gift was made seven years prior to death) valued at less than £250,000 are not liable for IHT.

Steps to calculate the inheritance tax value of an estate

There are three main steps that need to be completed to calculate the inheritance tax value of a deceased’s estate.

Identify the deceased’s assets and/or debts – before you can calculate the estate’s value, and therefore inheritance tax due (if any), a list of all the deceased’s assets, debts, trusts or lifetime gifts must be drawn up. For example, pension and life insurance policies, mortgage payments, business assets, money in bank or building society accounts, property and/or land, furniture, jewellery or artwork, trusts, shares and investments, loans and HP agreements, as well as any outstanding bills. In many cases, some of these details may not be easy to find so you’ll become a bit of a detective. Alternatively, hiring a probate solicitor will help the process and they are also able to write to organisations on your behalf. You will need to submit a copy of the deceased’s death certificate and prove that you have the legal authority, i.e. are the executor or a court appointed representative if there is no will, to request and receive information that is confidential.
Determine the estimated value of assets – once you have the full and final list, the next step is to determine the open market value of each asset. With insurance policies, mortgage companies, banks, building societies, trusts, shares and investments, loans, outstanding bills and any other creditors, the provider will give you an up-to-date value of the asset or debt. You will also be able to discuss payment terms and get any added interest stopped. For lifetime gifts, the value at the time of gifting is used unless the person receiving the gift benefited from it; then the value at the date of death is required. You will also need to value any joint assets, even if it is being passed on to the living joint owner.
Having a property and its contents valued – this part of the process is more complicated than the above assets. The value placed on the deceased’s property and/or land as well as the contents must be a realistic selling price should it come to the open market at the time of death. There are two parts to the valuation:
1. Ask a local estate agent or surveyor that is experienced in valuing property for inheritance tax purposes to visit and value the property and/or land. The reason you need to ensure they are experienced in providing an IHT valuation is that HMRC will ensure the valuation is examined by the District Valuer Services (DSV) to determine the valuation’s accuracy. If they feel that it is too low or too high, they may request further evidence to support the given valuation.
2. Firstly, make a list of the contents, including jewellery, furniture, artwork and cars, then carry out searches online to determine the average value for the items if they were being sold. However, keep in mind that you are comparing used items with new items. For some items that are more expensive, such as jewellery and artwork, it is worth getting a professional valuation. If you feel this is too big a task, a probate solicitor can liaise with a house clearance company to carry out this task for you.

Reporting inheritance tax value to HMRC

Prior to January 2022, estates that required a grant of probate had to complete a full inheritance tax return (IHT400) or if the estate was exempt, a summary inheritance tax return (IHT205).

However, new regulations (after 1^st January 2022) mean that representatives of a deceased’s estate that is exempt from IHT, known as excepted estates, and does not require grant of probate don’t have to complete an inheritance tax return.

Instead, the executors (solicitors or representatives of the estate) will need to make a declaration to HMRC to confirm the value of the estate as part of the probate application process. That said, if the deceased’s estate is complex, such as including foreign property, asset trusts in excess of £1 million or several lifetime gifts, a full IHT return will be required.

At Probates Online, we offer a Complete Estate Service to help you through the probate process and estate administration upon the death of a loved one. If you are looking for advice on inheritance tax, gifts or trusts, or need to apply for Grant of Probate, Letters of Administration or would like to take advantage of our entire Estate Administration service, visit our website for more information or contact us today.

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Benefits of a Complete Estate Service at Probates Online

Posted on February 17, 2022 by Vive Kumar Singh

Managing the estate of a loved one, a friend or a colleague, whether you are a spouse, family member or executor of the will (if there is a will), can be challenging. There are so many aspects to consider, paperwork to complete, tax obligations to pay; and that’s on top of having to make funeral arrangements and distribute assets to beneficiaries.

If the deceased left a detailed will and estate plan that sets out their wishes and how they want their estate to be distributed, the process should be fairly simple. However, in most cases, even if a will has been left, there are other factors that can be difficult to understand.

Hiring our complete estate service will relieve the burden and offer all the assistance you need. Whether you or the executor has already obtained Grant of Probate or not, when you use our complete estate service you remain the executor; we just administer the entire estate on your behalf.

Our Complete Estate Service

From the day we take your instructions, we are acting on your behalf. Our service goes beyond just handling the paperwork. Our service covers:

Confirm the eligibility of the executors and apply for Grant of Probate (if required).
Review the validity of the will and other related documents, like an estate plan.
Consider inheritance tax reliefs potentially applicable to the estate.
Assess the nature, extent and value of the estate’s assets and liabilities for inheritance tax purposes.
Liaise with HMRC regarding the valuations of the estate’s assets and/or liabilities that we have supplied or retrieved.
Collect the estate’s assets, close accounts and discharge any liabilities of the estate.
Liaise with asset holders on your behalf.
Arrange insurances for any property that needs to be safeguarded during the administration period.
Liaise with the Department for Works & Pensions regarding any liability arising from overpaid benefits or the ineligibility of benefits due to an oversight in providing full disclosure of capital or income.
Liaise with charities and their designated offices on your behalf (if required).
Discuss with HMRC the basis of calculation of any past, current or future liability for inheritance tax, capital gains tax, income tax or any other taxes following application for probate.
Arrange for any statutory notices required to be published in The Gazette and local newspapers to protect you from any challenges to the estate (the advert fees are charged at cost).
Arrange for the final distribution of the estate to entitled beneficiaries.
Prepare final estate accounts covering the period of estate administration.
Stop any unwanted mail addressed to the deceased and safeguard against identity theft.

At all times, we will keep you fully updated on the administration process and are always on hand to provide with support and advice. It is worth noting at this point that there are some situations that are not covered by our complete estate service, including:

A dispute about the will or questions on its validity;
A beneficiary being left out of a will deliberately by the deceased and they want to make a claim;
Assets held in a trust or the will states that a trust must be created;
An insolvent or bankrupt estate;
The deceased either lived abroad or died abroad; and
The estate includes property or assets that are foreign to the UK.

However, we are able to investigate and handle these matters on your behalf, if required.

Benefits of using an estate administration service

There are a variety of benefits to using an estate administration service, including:

They will help shoulder the burden of managing the deceased’s estate.
They are specialist probate solicitors who thoroughly understand administration process.
They are legal professionals and will understand the legal jargon that is used in much of the documentation.
They are able to liaise with HMRC, insurance companies, pension providers and other representatives in settling any liabilities attributed to the estate. This includes closing any relevant accounts and obtaining life insurance funds on your behalf.
They fully understand the different tax liabilities that an estate incurs, including any potential tax reliefs that can be applied to reduce the tax burden.
They will complete and file all the necessary documentation on your behalf, including applying for Grant of Probate or Letters of Administration (if no will has been left by the deceased).
They will ensure that all the relevant tax exemptions and reliefs have been applied, that HMRC’s tax calculations are accurate and ensure payment deadlines are met.
They will collect all the estate’s assets, obtain valuations (if necessary), and distribute the assets in accordance with the deceased’s wishes in their will. If no will has been left, they will organise the equal distribution between family members.
They will prepare and submit final estate accounts that details all estate transactions/payments, assets sold and distributed, debts settled and other related costs.

Probate can be a time consuming, lengthy process, sometimes taking as long as a year or more depending on the complexity of the deceased’s estate. Whilst you and the executors are entitled to manage the administration by yourself, any mistakes made in tax calculations or incorrect information on documentation will not only delay probate, you or the executor could be held financially or legally responsible for the error.

As well as supporting you throughout the probate process, we are also able to advise on any other legal matters relating to the deceased and their estate.

When you use our Complete Estate Service, our specialist probate solicitors will take responsibility for their work, relieving you from any legal or financial burden.

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What is the Inheritance Threshold – Rules and Allowances?

Posted on February 7, 2022 by Vive Kumar Singh

When someone dies, there is a tax applied to the value of that person’s estate which is known as Inheritance Tax (IHT). The beneficiaries and/or executor of the deceased’s estate are liable to pay the tax if the value is above a tax-free allowance, which is known as the threshold.

In some cases, there will be no inheritance tax to pay but if the value of the deceased’s estate is above the threshold, IHT will be payable. There are measures that can be taken in order to reduce the level of inheritance to be paid on your death if you think that the value of your estate is likely to be above the threshold limit.

To add to the mix, the government announced a series of changes to inheritance tax in 2021 that have become applicable in January 2022. The changes are designed to make reporting IHT returns simpler for estates above and below the threshold limit. So, let’s explain the inheritance tax threshold limit, as well as the rules and allowances around IHT.

Inheritance tax thresholds

There is currently only one threshold and that is £325,000, which is called the nil rate band. So, any estates valued below this threshold limit are levied at nil tax. Any estates above the threshold must pay IHT on the sum over and above £325,000 at 40%. Let’s give you an example:

If your estate is worth £600,000, your IHT is calculated as follows:

£600,000 – £325,000 = £275,000
£275,000 x 40% = £110,000 IHT

So, based on this calculation, the estate’s beneficiaries will receive £325,000 + £165,000 which equals £490,000; this is the remainder following payment of IHT.

However, there are several situations where the threshold is different.

● Married and civil partnerships – if you are married or in a civil partnership and leave your entire estate to your spouse or partner, should you die first, there is no tax to pay and in most cases, the nil rate band threshold won’t have been affected either. This means that the living spouse will be able to add the unused balance of their deceased spouse’s/partner’s threshold to their own, essentially doubling their threshold. But if your spouse/partner leaves a part of their estate to other beneficiaries, or made a lifetime gift seven years prior to their death, if the estate is of high enough value there will be IHT to pay and some of the nil rate band threshold may be taken.
● Leaving a property – if you are married or in a civil partnership and leave the family home to your living spouse or a direct descendent, i.e. a child or grandchild only, in its entirety, under current rules there is a further £175,000 tax free allowance but only if the value of the property is under £1 million. Anything above this value and the allowance drops significantly. Again, any unused tax allowance balance can be added to the living spouse’s allowances on their death.

Spouses/civil partners and IHT

In most cases, you are able to leave your estate, i.e. your assets, property and any other possessions, to your spouse/partner tax free. In addition, the surviving spouse or partner is able to add any unused tax free allowance to their own tax allowances. So, in reality, you could leave your spouse/partner as much as £650,000, or £1 million if it includes a property, without them having to pay any IHT.

However, if the deceased spouse/partner used most or all of their tax free allowance by leaving a proportion of their estate to a direct descendent, the above does not apply. Also, if the spouse/partner died before 21 March 1972, the double allowance rule does not apply either.

Tax free gifts and trusts

When making gifts to spouses/partners or to charities, there is the potential they are exempt from tax but it does depend on when the gift was made. If it was given at least seven years prior to death to an individual – that means it was not gifted to a business or a trust – there will be no tax to pay on the gift. However, if the person dies before the seven years, there will be a tax levy to pay. How much tax is paid depends on when the person dies during that seven year period. For example, if the person dies within 5 years, only those five years apportioned to the gift are tax free; the remainder of the gift is included in the deceased’s estate. This is known as IHT taper relief on potentially exempt transfers (PETs).

The total amount a living person is allowed to gift a spouse/partner, another individual or a charity or a political party in any one tax year is £3,000, which is known as an annual exemption. This can be carried forward for one year only; i.e. if you didn’t make any gifts in one tax year, you can add the annual exemption allowance from that year to the next year, making a total annual exemption in the second year of £6,000, or £12,000 if making gifts as a couple.

You can also gift tax free to your children, up to the age of 18, for their training or education. In addition, parents are allowed to gift their children £5,000 tax free for their wedding and any gifts for the maintenance of relatives that are infirm or old is also tax free. Any gifts below £250 are also tax free.

It is also possible to put assets into a trust that is left to a beneficiary after your death. Whilst the trust doesn’t exempt the estate from paying IHT, it can go some way to reducing the amount of IHT paid. The reason is that assets held in a trust are managed by appointed trustees on behalf of the beneficiaries – it is worth noting here that the trust legally owns the assets and not the trustees or the person who set up the trust. If you live beyond seven years from the date the trust was established, those assets are not included in the estate upon death and may be tax free. Instead, a 20% IHT tax levy is imposed when you set up the trust and every ten years, the assets are revalued and 6% IHT is paid at the time, minus the nil rate band threshold of £325,000.

Ultimately, before you consider any of the above, you must always get professional advice and it is recommended to use a solicitor or probate firm to help you.

At Probates Online, we are able to offer a professional probate service online, including making gifts and establishing trusts on your behalf.. If you are looking for advice on inheritance tax, gifts or trusts, or need to apply for Grant of Probate, Letters of Administration or would like to take advantage of our entire Estate Administration service, visit our website for more information or contact us today.

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Inheritance Tax Relief by Leaving a Gift to Charity

Posted on January 30, 2022 by Vive Kumar Singh

As people in the UK are being encouraged to get their will drawn up and their estate planning in order, there are several ways to reduce the amount of inheritance tax payable on a deceased person’s estate. One of these is the inheritance tax relief received by leaving a gift to charity.

As the value of property increases so does the value of people’s estates, pushing them above the £325,000 inheritance tax threshold. Indeed, the OBR, Office for Budget Responsibility, are suggesting that by 2026 there could be as many as 50,000 estates falling victim to inheritance tax. But by leaving a gift to charity in your will, your beneficiaries could receive inheritance tax relief.

What is inheritance tax relief?

First, let’s start with explaining inheritance tax. It is the amount of tax your beneficiaries will pay on your estate upon your death. Currently, the inheritance tax rate is 40% and the threshold is £325,000. So, if your estate is valued at £600,000 and you deduct the threshold amount of £325,000, your beneficiaries who have inherited your estate will pay 40% tax on the remainder – £275,000 – to HMRC. If the estate is valued at less than £325,000, there is no inheritance tax payable.

However, there are some tax allowances that can reduce the amount of inheritance tax paid by your estate beneficiaries. One of these allowances is if a percentage or the entire estate is ‘gifted’ to a charity, or the estate is left to a living spouse or civil partner. Inheritance tax relief also applies to gifts that have been made to a beneficiary seven years prior to the death of the testator.

Why leave a gift to charity?

Many people have favourite charities which they have supported in their lifetime, and they often choose to further support the charity upon their death by leaving a gift to them in their will. As well as the charity benefiting from the gift, it can also benefit the deceased’s family by reducing the amount of inheritance tax (IHT) payable.

When gifts are left to qualifying charities – a charity that is established for a charitable purpose and satisfies jurisdiction, registration and management conditions – the level of IHT applied to the deceased’s estate above the threshold drops to 36%, as long as a minimum of 10% of the net estate’s value (the baseline amount) is gifted.

So, taking our example above, if the deceased gifts £50,000 to charity, which is above the 10% baseline amount, and the cost of funeral expenses and paying any debts are deducted, i.e. £20,000, the amount of IHT payable is £275,000 – £70,000 = £215,000 x 36% = £77,400.

So, the total amount payable to HMRC is £77,400, leaving £137,600 to the deceased’s beneficiaries as their inheritance.

What to consider when leaving a gift to charity in your will?

If you are thinking about leaving a donation to a charity in your will, here are some points to consider:

● Cash or asset – leaving a gift to charity doesn’t have to be cash; you can also leave an asset, such as property, jewellery, antiques or even artwork. It is then up to the charity what they do with that asset. In addition, you can also leave what is known as a reversionary gift; this is a gift, like a physical asset, that is initially left to the deceased’s specified beneficiary, usually a spouse, and upon their death it passes to the charity.
● Ensure it is a qualifying charity – not every charity can claim to be a qualifying charity so make sure the charity you choose is registered with the Charity Commission in England and Wales. Scotland and Northern Ireland have their own charity register where you can check to see if the charity you’ve chosen is registered. If your charity is not registered but adheres to the Charities Act definition of a charity, your estate and beneficiaries will still benefit from inheritance tax relief.
● Add any instructions – when making a gift to charity, you may want the funds you give, or the asset, to be used in a specific way, such as aiding research. In this situation, you can add any instructions to your gift in your will but make sure you discuss with the charity of your choice first, to ensure it is feasible for the charity to honour your wishes.
● The gift value may change – if you are gifting a lump sum to a charity or a percentage of your estate, be aware that this may change and the charity may receive less than you intended. By index-linking the gift, you can protect your charitable gift from increases in inflation which would impact a lump sum. However, if gifting a percentage of your estate and the value of your estate decreases in size, you may wish to adjust the percentage of the gift in your will.
● Residual gifts – similar to the above, if you leave the residual amount of your estate, i.e. what’s left after expenses, debts and any other legacies have been deducted, you may find that the charity receives a greater proportion of your estate because their gift is tax-free, whilst another beneficiary will have tax deducted from their share.
● Double-check the charity’s details – when drawing up your will in advance of your death and making a gift to a charity, always keep up to date with the charity’s details, such as any name changes to the charity, or a different address or the charity closes. Therefore, add the charity’s registration number (if there is one) and if not, update your will accordingly.
● The cause of a dispute – always be upfront with your family and other beneficiaries about your charitable gift in your will. In accordance with the Inheritance Act (Provision for Family and Dependants) 1975, beneficiaries have the right to dispute a charitable gift. So to avoid any disputes after your death, make your intentions clear and reassure family and beneficiaries they will be provided for in the future.

At Probates Online, we are able to offer a professional probate service online that is efficient and affordable. If you are an Executor of a will and need to apply for Grant of Probate, Letters of Administration or would like to take advantage of our entire Estate Administration service, visit our website for more information or contact us today.

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What Are the Risks When You Set Up Lasting Power of Attorney?

Posted on January 26, 2022 by Vive Kumar Singh

Should you have a long-term debilitating illness or be suffering from a loss of mental capacity, it is reassuring to know that someone you trust is managing not only financial matters, but is also able to make decisions regarding your ongoing health, welfare and care.

To make this possible, before (and if) you get to this stage in your life you will need to draw up a Lasting Power of Attorney (LPA). By appointing someone, known as the ‘attorney’, to look after you and make decisions on your behalf when you are not capable of doing so yourself can bring great peace of mind. However, there can be risks associated with a Lasting Power of Attorney.

What is a Lasting Power of Attorney (LPA)?

An LPA is a legally-binding document that allows an appointed, or ‘chosen’, person, called an attorney, to handle your financial, health, well-being and care matters should you be in a position where you are unable to make decisions for yourself.

There is a difference between a Power of Attorney (POA) and an LPA – a POA is only designed for an attorney to handle your financial and property affairs. An LPA is designed for an attorney to manage your financial, property, health, welfare and care matters.

Whilst you can draw up your own LPA using a DIY option, it is better to have a POA or LPA drawn by a legal professional who is experienced in this matter to ensure that nothing has been left out, that it is correct and that it will be registered with the Office of the Public Guardian (OPG) in England and Wales via a form. There are different rules for drawing up an LPA in Northern Ireland and Scotland. This means that should the POA or LPA become active, there is no possibility of it being rejected by another party, such as banks, doctors or utility providers.

Choosing the right person to act as attorney is crucial to an effective, properly managed LPA; they must be over 18 years of age and someone that you trust to look after your affairs. They don’t necessarily need to be a member of your family, they can be a close personal friend and sometimes that can be a preferred option to release any emotional pressure a family member may feel. Remember that the person you choose will have access to your bank accounts and all matters relating to you. They will be making decisions and signing off on any financial matters, including selling or buying property, as well as your care and where you will live.

You may decide to choose more than one attorney, each having a different responsibility towards you, such as one to look after property matters, another to make financial decisions and another to manage your care and welfare. Ultimately it is up to you but bear in mind that their individual decisions will have an impact on another attorney’s decision so make sure they all know each other and are happy to collaborate together.

If you do not have an LPA and lose the mental capacity to make decisions yourself, then an application to the Court of Protection must be made and they will make a decision about your financial, property, health and welfare matters, or appoint a deputy to act for you.

Risks associated with an LPA

As with any situation where you are handing over control of your affairs, there is an element of risk involved. Some of these risks are:

● They will have access to your personal, private and confidential information.
● They will be making decisions about your lifestyle, such as where you will live if not in your own home.
● They will make decisions on what treatment you should and should not receive.
● They have access to your personal correspondence and other papers, such as your medical records.
● They will be managing your bank account(s) and other financial matters. However, if it is found by the court that they have acted dishonestly, fraudulently or mis-managed your finances they will have to pay you back.

It is vitally important that you trust the person(s) you appoint as an attorney(s). It may be wise to include an advance decision or statement in your LPA that specifies your wishes/preferences in certain situations. Some questions to consider when choosing your attorney are:

● Do you wish to have another person, i.e. a member of your family, to have a say in what treatment you receive, your future healthcare and personal care. Ultimately the decision is down to your attorney but if you’ve made this wish, they should consult with the other person.
● Will your attorney listen to medical professionals about your treatment/healthcare and always have your best interests at heart?
● Will they be making decisions for you in the short-term or long-term?
● Do you fully trust them to make the right decisions for you as you would have made yourself?

It is worth noting that if you have appointed more than one attorney to look after specific areas of your life, they cannot make a decision on an aspect they have not been appointed for; i.e. if they are looking after your financial and property matters, they cannot make a decision about your healthcare or welfare.

There are some areas where an attorney is not allowed to make a decision on your behalf, such as:

● To go against any decision or preference you’ve made, i.e. refusal of certain treatments, in your advance decision/statement in your LPA.
● To agree to a deprivation of liberty (a situation where your liberty is taken away from you, i.e. you are not free to leave and are placed under constant supervision) to be imposed on you without a court order.
● If you are under a guardianship, they are not allowed to make a decision that conflicts with your guardian’s decision, such as where you live.
● They are not allowed to make decisions that you wouldn’t normally make yourself, such as going against the law.

At Probates Online, we are able to offer a professional online probate service, including drawing up a Lasting Power of Attorney or Power of Attorney, which is efficient and affordable. If you want advice on LPAs and POAs or need to apply for Grant of Probate, Letters of Administration or would like to take advantage of our entire Estate Administration service, visit our website for more information or contact us today.

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Types of Wills – Which Type of Will Do You Need?

Posted on January 14, 2022 by Vive Kumar Singh

The Covid-19 pandemic has highlighted many aspects of our lives, none more so than the need for making a will. However, the latest research from Canada Life shows that 59% of UK adults have not written a will – that’s 31 million people whose estate could end up in the hands of someone not of their choosing.

But when it comes to writing your will, it can be hard to know which type of will you need as there are four different types of will in the UK – single, joint (mirror), living and trust wills. So let’s take a closer look at the different types of will, what they should include and which one is right for you.

Do I need a will?

First, let’s answer a common question. In a nutshell, yes, you do need a will if you want to decide who gets what from your estate on your death. But that’s not the only reason; a will can also be used to ensure that should you not be able to take care of yourself and make your own decisions at some point in life, your affairs and wishes are taken care of during your lifetime.

A last will and testament is one of the most important documents in your estate planning and it is up to you who benefits from your estate, and who manages the distribution of your estate when you die.

Types of Will

Different types of will have different purposes; wills are drawn up to not only cover how your assets are distributed upon your death but can also include your funeral plans, the beneficiaries for any special items or sentimental or personal value – such as family heirlooms – and some wills also cater for your healthcare wishes if you are incapacitated and are unable to make your own decisions. Which will is suitable for your needs depends on your circumstances.

Single (simple) will – probably the most well-known, common will that is used by an individual that details their wishes upon their death. It can be used by anyone that is single, divorced or in a relationship where their wishes are different to that of their partner/spouse. This type of will is also used by people that have children from a previous relationship and wish to divide their estate between children/spouses from both relationships. However, in these circumstances, you may find that a trust will is more appropriate.
Joint (mirror) wills – this type of will is for couples, whether it is your spouse, your civil partner or the person with whom you have a long-term relationship, that have the same wishes upon their death, hence the term ‘mirror’. Whilst two wills are drawn up by your solicitor (or yourself), the wills are almost identical. There are several things to be aware of if you decide to have a joint will:
- Upon the death of one spouse, the entire deceased’s estate passes to the surviving spouse.
- Upon the death of the surviving spouse, the estate is distributed in accordance with the joint wishes specified in the will. This could create a problem should the surviving spouse remarry or commit to another long-term relationship as any step-children will be omitted, or there are children from a previous marriage.
- There has to be an element of trust between spouses/civil partners as there is no guarantee an estate will be passed on to the people you wish.
- Because the two documents of the will are drawn up at the same time, either party is entitled to change their will at any time and they legally do not have to advise the other party of the change. Therefore, you may find that a trust will is a better option.
Trust wills – there are several different types of trust wills, depending on your needs, and they provide greater flexibility over who benefits from your estate, which can be broken down into property and assets. A trust will can also detail how the estate is managed upon your death if the beneficiaries are below a certain age, and your wishes in terms of your healthcare and welfare[1] .
- Discretionary trust wills – this type of will puts a proportion of, or the entire estate into a trust that is managed by your appointed trustees upon your death. A discretionary trust will name the beneficiaries of the trust, which may be receiving an income from the trust until the beneficiary reaches a certain age or to look after a beneficiary’s health and welfare, such as a child or adult with a disability. The trustees must manage and administer the trust according to your wishes, although they do have some discretion. In addition, it can protect beneficiaries from paying too much tax and from creditors should a beneficiary be in severe debt.
- Property trust wills – this type of trust will work in a similar way to a discretionary trust will but holds your property (or properties) in a trust from which a beneficiary can receive an income. For example, a surviving spouse would receive an income from the property trust and also be able to continue to live in the property but on their death, the assets pass to other beneficiaries as stated in the trust will.
- Flexible Life Interest trust will – again, this is similar to the other types of trust will but provides greater flexibility in providing an income from the assets protected in the trust. Therefore, should you have a spouse that needs ongoing care or there are care home fees to pay, the trustees have greater control on how and when the trust funds are released. Whilst these types of trust do protect from Inheritance Tax, both Capital Gains Tax and Income tax will still apply.
Living will – lastly is the Living will which is also known as Advance Decisions because this type of will details any care and medical treatment you may require in the future, should you be in a position where you can’t make those decisions for yourself. This can include life-support, being put on a ventilator or CPR as well as treatment for long-term illnesses, such as Parkinson’s or cancer.

All wills must be signed by the testator (the person making the will) in front of at least two witnesses, who will also sign the document as confirmation they have seen the testator signing the will.

As well as the above types of will, which are the most common, there are also two other types – holographic wills are handwritten wills and oral wills, which are also called ‘nuncupative’ wills.

At Probates Online, we are able to offer a professional probate service online that is efficient and affordable. If you are an Executor of a will and need to apply for Grant of Probate, Letters of Administration or would like to take advantage of our entire Estate Administration service, visit our website for more information or contact us today.

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