What Is a Limited Grant of Probate in the United Kingdom?

Limited Grant of Probate

If a will is disputed by potential beneficiaries of an estate on the death of a person, those disputing the validity of the will can apply to the Probate Registry for a caveat to be placed against the deceased’s estate. This prevents the executors of the will from obtaining a grant of probate and stops them from administering the estate.

In these situations, it can take considerable time before the matter is resolved. In that time, not being able to collect and subsequently sell the assets of the estate may result in not only the deterioration of the asset, such as property but also in a reduction in the value of the estate.

In these circumstances, it may be possible to apply to a court for a limited grant of probate that allows the executors to continue administering the estate in order to protect its value, as well as pay any estate liabilities, such as tax.

What is a limited grant of probate?

In the UK, there are several reasons for contesting a will, and they are:

  • Testamentary capacity – did the deceased have the required mental capacity to make a valid will?
  • Due execution – there was a failure to meet the required formalities when making the will. For example, the will wasn’t correctly signed and witnessed.
  • Insufficient knowledge and approval of the will – did the deceased know about and understand the meaning and/or content of the will?
  • Under undue duress or influence – was the deceased under pressure from another party to make or change their will?
  • Forgery or fraud – was any part of the will changed without authority, or were the signatures faked?
  • Rectification and construction – is the will or any of its content unclear, ambiguous or does not carry out the deceased’s wishes or intentions?

Anyone that wishes to contest a deceased’s will must do so within six months of the date the grant of probate was issued. However, if the will is contested before the grant of probate has been granted, the executors of the deceased’s estate can no longer proceed with the administration of the estate.

In order to maintain and preserve the assets of the estate’s value and pay its liabilities, such as paying inheritance tax to HMRC, the executors (usually done via a solicitor as the person that applies must be independent of the dispute) can apply for a limited grant of probate.

Called a Grant ad colligenda bona, it means that the executors or administrator of an estate is granted permission to preserve the estate’s assets but not distribute any assets. However, they are in some cases allowed to continue with the sale of a property or other assets if they are not part of a beneficiary’s inheritance. In addition, HMRC will require a full account regarding the estate.

A limited grant of probate is only valid for six months. If the dispute hasn’t been resolved within that time, the executors will need to apply for a continuation of the limited grant of probate. Solicitors are also able to apply for a ‘grant pending determination of a probate claim’. Both provide the authority to gather in and preserve the deceased’s assets as part of their estate, and continue to administer the estate, but cannot distribute any part of the estate to beneficiaries, including any monetary amounts gathered, until the dispute has been resolved and full grant of probate or administration has been made by the Probate Registry.

Applying for a limited grant of probate in these circumstances, or if a caveat has been lodged with the court, means that the value of any assets that may depreciate in value if they are not maintained is preserved, thereby avoiding any potential of negligence allegations at a later date.

If any assets or funds that are part of the deceased’s estate are distributed, the personal representatives of the estate, i.e. the executors or solicitor, may be held personally liable for the assets or funds that have been paid out to beneficiaries.

Applying for a limited grant of probate

Applying for a limited grant of probate, which can include limited grants of administration to solicitors, grants pending suit (called pendente lite) and grants to the use and benefit of a minor, must be done through the Probate Registry.

The application must be supported by an Affidavit and Oath detailing the reasons why a limited grant of probate is required. For example, if a property forms part of the estate and due to the time taken to resolve any dispute, the empty property may fall into disrepair, a limited grant of probate may be granted to allow the executors to look after the property and preserve its value. Before the Probate Registry can issue the grant, it must also be approved by HMRC and the District Registrar. Although in urgent cases the grant can be approved quickly, most of the time it takes four to six weeks.

Once the Grant ad colligenda bona has been approved, it is important that the powers within the limited grant are not exceeded. In addition, once the dispute has been resolved to the satisfaction of all parties or all the information required has been gathered, the executors (or solicitor) of the deceased’s estate will still need to apply for a full grant of probate. Without this, they will not have the authorisation to distribute the estate’s assets to beneficiaries in accordance with the deceased’s wishes.

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.

How Long Does a Grant of Probate Take in the United Kingdom?

Grant of Probate Take

When someone dies in the United Kingdom, if they leave an estate, i.e. their assets, that is valued at more than £5,000, an application for a Grant of Probate is necessary if there is a will. If there is no will, Letters of Administration will need to be applied for, which is a form of probate.

Only an executor of a will, or next of kin if there is no will, are allowed to apply for Grant of Probate, or Letters of Administration respectively. But how long is Grant of Probate time and what other aspects can speed up or delay the process?

What is a Grant of Probate?

Grant of Probate is the official authorisation from the court that allows the executor(s) of a deceased’s will to administer their estate. This includes assessing whether any Inheritance Tax (IHT) is due to be paid and settling with HMRC, finalising the deceased’s accounts and distributing assets to beneficiaries according to the deceased’s wishes as detailed in their will.

Letters of Administration is the same as Grant of Probate but for deceaseds’ estates that do not have a will but grant the next of kin authorisation to administer the estate in the same way an executor would do so.

Is a Grant of Probate needed?

If the value of the deceased’s estate is over £5,000, then a Grant of Probate from the court is needed.

If the deceased left a will, the appointed executor(s) applies for a Grant of Probate. If there isn’t a will, the deceased’s next of kin or a family member applies for Letters of Administration; they will be called the Administrator. Both grant the recipient the authority to administer the deceased’s estate. 

There are other situations where Letters of Administration are needed instead of Grant of Probate, and they are:

  • One person has been left the entire estate;
  • There are no executors named in the will;
  • The named executors are not prepared to accept the role.

It is not always necessary to apply for a Grant of Probate. For example, if the majority of the deceased’s estate is jointly owned with their living spouse or civil partner.

What is the current Grant of Probate time?

The person’s death should be registered within five days and the application for Grant of Probate must be submitted to the Probate Registry within six months.  The reason for this is that any IHT due must be paid to HMRC within this time frame.  So, the earlier you can apply for a Grant of Probate, the quicker you will be able to submit the relevant forms to HMRC regarding the estate’s value.

The Grant of Probate time is normally within 8 weeks from the time the application is received. The Probate Registry will start to action your application – most individuals and solicitors apply online – but you will also need to send originals of certain documents, like the death certificate. Any delay in sending these documents may result in the approval of the Grant of Probate.

When you submit your application, you will need to pay an application fee, which is currently £273 if the estate is valued at over £5,000. If below this valuation figure, there is no fee to pay. It is always advisable to purchase at least one extra copy of the Grant of Probate document (£1.50/copy) as you may need to send an original copy to other parties, such as HMRC. However, the Probate Registry is still catching up from the delays incurred during the Covid-19 pandemic so it may take a few weeks longer to receive a Grant of Probate or Letters of Administration.

Applying for Grant of Probate/Letters of Administration

The process for Grant of Probate or Letters of Administration is similar.  Before you apply, make sure you have: 

  • An official copy of the death certificate (if applying online, you can scan the certificate as an image to upload it and send the original by post);
  • The original will;
  • The application fee.

You can only apply for probate online if all the named executors are alive and able to make decisions and the deceased lived the majority of their life in England and Wales.

If the executor(s) or next of kin aren’t sure about applying for a Grant of Probate or Letters of Administration, a solicitor is able to complete the process on their behalf. If there is a will, the process for applying is:

  • Complete and submit Grant of Probate or Letters of Administration forms. It’s a good idea to complete HMRC’s inheritance tax forms at the same time. All of the forms can be submitted online but you will need to send the original documents, such as the will and death certificate, as well.
  • Pay any inheritance tax due on the estate to HMRC, if applicable. The Probate Registry will liaise with HMRC to ensure this has been completed.
  • Whilst waiting, pay any outstanding debt, such as utility bills, credit card balances, loans or mortgages.
  • If there’s life insurance, contact the company to claim the fund’s payout as this may be enough to cover any outstanding debts and funeral costs.

At the same time, the application is being processed, advise beneficiaries of progress and contact the utility companies, banks, insurers and mortgage providers to request they close the deceased’s account. This stops any additional charges from being applied; also ask them to send a final statement.

If there is no will, the deceased’s next of kin or a close relative will need to apply for Letters of Administration which you can do yourself via post using the form PA1A, the probate application form. 

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 a 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.

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

Inheritance Tax

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.

  1. 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.
  2. 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.
  3. 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 1st 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.

What is the Inheritance Threshold – Rules and Allowances?

Inheritance Threshold

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.

Inheritance Tax Relief by Leaving a Gift to Charity

Inheritance Tax Relief

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.

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

Lasting Power of Attorney

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.

Why Use an Estate Planning Lawyer to Make a Will?

estate-planning-lawyer

Some people don’t need to worry about making a will, such as young adults with no children or assets, just yet; however, a large proportion of people in the UK not only need to make a will but also need to consider estate planning lawyer if they have a number of valuable assets. 

Whether your estate is reasonably straightforward or more complex, such as an extensive property portfolio of assets in foreign countries, using an estate planning lawyer enables you to incorporate several aspects pertaining to your estate under one roof.

What is estate planning?

There are several aspects to estate planning, including making a will, which incorporates every aspect of planning who gets what, where, and when upon your death, as well as who makes decisions on your behalf, if required during your lifetime. Let’s look at the different aspects of estate planning:

  • Making a will – a will is a legal document that lists all your assets and their relative value, states your beneficiaries and what you have decided they will receive upon your death.
  • Powers of Attorney (POA) – a POA gives permission to a person of your choice to make certain decisions on your behalf should you be in the position of losing your mental capacity to make the decisions yourself or will be out of the country for a long period of time, or you are seriously ill for any reason. However, there are three forms of POA:
  • A continuing power of attorney gives permission regarding your property assets and financial matters.
  • A welfare power of attorney is only used when you do not have the mental capacity to make decisions on your medical care or about the treatment you receive, and even about where you live.
  • A combined power of attorney brings together the above two POAs so the person of your choice can make decisions about your financial matters as well as about welfare and health.
  • Planning business succession – if you run a business, an estate planning lawyer will help you plan the running of the business when you want to retire or upon your death, including:
    • Who takes over the business’s operations?
    • Where do the business’s profits go, i.e. equally to beneficiaries or reinvested back into the business?
    • Does your death impact a partnership agreement?
    • If you’ve appointed an executor, are they experienced in selling a business?
  • Trusts – a trust is a method to manage your finances and assets for your beneficiaries, and they can help reduce the impact of inheritance tax and capital gains tax.

What’s included in your will?

There are four forms of wills – simple, joint, living, and testamentary trust – which one you choose largely depends on your circumstances and your estate. Whilst there are also handwritten wills and oral wills, known as ‘nuncupative’ wills, let’s look at the four main types.

  • Simple will – the most common, a simple will is the choice of many people. It details your assets, who will receive them, names guardians for your children under the age of sixteen. A simple will often forms the basis of other wills.
  • Joint will – also known as mirror wills, they are signed by more than one person but culminate in separate wills for each testator. They are usually made by spouses where the executor, beneficiaries and other matters are the same. The drawback of joint wills is that should the surviving spouse’s wishes change, they can’t change the joint will.
  • Living will – this type of will isn’t to do with distributing your estate on your death but is to do with your wishes should you become incapacitated. Similar to POAs, you can specify who will make decisions on your behalf and what your wishes are should something happen to you.
  • Testamentary trust – this type of will puts certain assets into a trust, such as property, for your beneficiaries to benefit at a later date, i.e. minor children. You will need to name the trust’s trustees – the people who will manage the trust – in the testamentary trust will.

Before you carry out any estate planning or make a will, you will need to take an inventory of your assets. An estate planning lawyer will be able to help you with this task and review your assets to work out the most tax-efficient way in which to pass on your assets to your beneficiaries.

Your will needs to include:

  • Physical property, such as buildings and land.
  • Intangible property, such as stocks and shares, bonds, patents and copyrights, intellectual property and businesses owned, or any interest in a business that you have – you will need to specify who will take over your part of the business.
  • Unproductive property of value, such as jewellery, artwork, cars and furniture.
  • Cash, including money in your bank accounts and savings accounts. Don’t forget that your spouse and family will require cash to pay any outstanding debts as well as taxes upon your death.

However, there are some things that shouldn’t be included in your will, such as:

  • Property that is held as a joint tenancy, i.e. a property that is jointly owned with someone else. The reason is that the property will transfer for the other joint owner automatically.
  • Any insurance policies, trusts or other retirement plans that already state a beneficiary. However, it is possible to change your beneficiary, or beneficiaries, on any of these, as well as pensions and life assurance policies.
  • Any stocks, shares or bonds that are already set up to transfer to someone else upon your death.
  • Digital assets are also not included in wills, at the moment, so cryptocurrencies may be a difficult asset to place in a will. However, an estate planning lawyer will be able to advise you accordingly.

The more concise and accurate your estate planning and will be, the smoother the transition for your family and beneficiaries.

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

Reasons for Making a Will and How to Pick the Right Adviser

Reasons to make a will

According to research from Canada Life, 59% of people don’t have a will. That’s potentially 31 million people who may die ‘intestate’, i.e. without a will, and whose assets, financial, property and other, may be inherited by someone not of their choice.

It’s a fair conclusion that most people believe that even if they don’t have a will in place, all their assets and possessions will pass to their spouse or civil partner if they die. Actually, that’s not strictly true. The only time all your assets pass to your spouse/civil partner is if you have no children and there are no other living relatives. In most cases, that isn’t the situation.

Another misconception is that because you’ve been living together for years and are common law partners, the same rules apply as if you were married. Again, that’s not true. In England and Wales, the state or common law partner is not recognised in the legal sense and therefore your partner will not receive any of your estate if you die without a will. These are just two reasons to make a will. So, why should you make a will?

What is a will?

First, let’s just clarify; a will is a legally binding document that sets out how you want your estate distributed upon your death. Also known as a last will and testament, it will include your beneficiaries and the possessions/assets you bequeath to them, who will bring up your children and who will look after your pets, if applicable, the details of any trusts and can also include your funeral arrangements. If you have an uncomplicated estate, you can write your own will, although that is not recommended, but if you have a complex estate, always seek the help of a qualified solicitor or professional will-writer.

Reasons to make a will

● Decide who looks after your children – if you are a single parent and were to die before your children had reached the age of 18, who would look after your children if you died? Instead of the court choosing who has the role, you can specify in your will who is going to be their guardian (do ask them before you add this clause to your will and make sure they are happy to take on the role). This not only ensures who you want to raise your children, it also stops someone you don’t approve of taking control.


● Sets out who benefits from your estate – as your will is a legally-binding document, how you decide who benefits from your estate is down to you. Whether your estate is minimal, i.e. doesn’t include any property, there will still be family heirlooms you wish certain people to have when you die. Of course, if your estate is large and complex, it becomes an even more important reason to make a will. Your will also makes sure that should you and your partner not be married, you are able to protect them and the family home by leaving them a share of the property or set out a right to reside in the property for them.


● The option to disinherit – your will defines who gets what and allows you to leave someone out of your will, if that’s your wish. Without a will, someone may inherit part of your estate which may be against your wishes. For example, if you have remarried, you may not wish your ex-spouse/civil partner to inherit any of your estate.


● Make a gift or a donation to a charity – you may decide that you wish to make a gift/donation to your favourite charity upon your death. Not only does this benefit the charity, there is the potential that your family will pay less inheritance tax, particularly if the donation is over 10% of the value of your estate.


● Ensure your family/children are provided for in the future – as well as making sure the right person raises your children (if applicable), you may also want to ensure their financial security, such as paying school fees, setting up a trust from which they receive a regular income or a deposit on their first home. A trust is a beneficial way of providing for your children once you’ve gone. You can either set it up before your death or leave instructions for a trust to be established after you die. Either way, a will makes sure your wishes are honoured. One essential point to note here is that if you do not have a will, only blood relatives will automatically inherit from your estate. If you have remarried and have stepchildren, foster children or adopted children, or any other dependents, there is every likelihood they will not benefit from your estate should you die unless you have a will in place.


● Avoids paying too much inheritance tax – whatever you do, your family will have to pay inheritance tax on your passing. However, you can reduce the tax burden by making a will. What you leave to your spouse/civil partner is automatically exempt and any property you leave your children/grandchildren may well be subject to less tax. Trusts are another area where less tax may have to be paid.


● Avoids disputes – without a will, deciding who gets what from your estate could get messy. Avoiding any family disputes, arguments or disagreements is a good reason to make a will. You can make your wishes clear and smooth the probate process, too.

Finding the right adviser

Whilst there are facilities available for writing your own will, you run the risk that its validity could be challenged. You may also miss out on certain aspects of your estate, which could cause probate problems. Therefore, it is always recommended you get professional advice from a solicitor or will-writer to help you write your will and ensure it is legal.

You may choose a solicitor who specialises in writing wills and probate; whilst this may be the more expensive option, they are highly experienced and will be able to make sure you have included every aspect of your estate, even things that you hadn’t thought of, such as any cash you may have in the bank.

There are also professional will writers but not all are legally qualified solicitors, lawyers or chartered legal executives, and therefore not necessarily regulated. Always check their credentials and qualifications carefully and make sure they are a member of the Institute of Professional Willwriters (IPW) which is the professional body that regulates the will writing profession.

Banks and charities also offer will writing services, which often come under the title of estate planning but as with professional will writers, do your due diligence. Recently, there has been a rise in online will writers, driven predominantly by the coronavirus pandemic. Their fees are likely to be lower than solicitors or even professional will writers and they are not allowed to be executors of your will.

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 a Grant of Probate or would like to take advantage of our entire Estate Administration service, visit our website for more information or contact us today.

Do I Need to Use Probate Solicitors or Can I Use Probate Experts Online?

Probate Solicitors

When someone dies, generally the executors or administrator of the deceased’s estate will need to apply for grant of probate in order to administer the estate.  Probate, however, is not always required if there is a living spouse or civil partner or the value of the estate is below a certain level.  But, in most cases, probate will be needed.  The question is, do you need to use specialist probate solicitors or can you use online probate solicitors?

https://www.probatesonline.co.uk/

Why probate?

In some cases, probate is required, sometimes it is not and in other cases, grant of letters of administration will be needed instead of probate.

Generally, if the value of the estate is in excess of £5,000, probate is required. 

When there is a will, the executor(s) appointed to administer the estate will apply for grant of probate.  The executor(s) can be a family member, a friend of the deceased or a solicitor.  However, if there is no will or the executor(s) resign from the role, the deceased’s next of kin or a close relative will need to apply for grant of letters of administration to administer the deceased’s estate, known as the administrator. 

Other circumstances where grant of letters of administration is required:

  • A beneficiary has been left the entire estate;
  • No executors have been named in the will;
  • The named executors are not prepared to accept the role and resign.

If the majority of the deceased’s assets are jointly owned with a spouse or civil partner, such as joint bank accounts or a joint mortgage, probate may not be required.  Cases where probate is not required include:

  • The estate is less than £10,000 in value and there are no shares or land within the estate.  If the estate is small, the bank or financial institution has the discretion to decide whether they need to see Grant of Probate in order to release the funds.
  • If any financial assets or property are owned jointly with a spouse or civil partner.

The probate threshold ranges from £5,000 to £50,000.  Banks and financial institutions have their own procedures regarding a deceased person’s assets; contact them as soon as possible.

When there is a will, an executor(s) will have been appointed to administer the estate and apply for grant of probate.  If there is no will or executor(s), the deceased’s next of kin or a relative will need to apply letters of administration to administer the deceased’s estate.   

Other circumstances when letters of administration are needed include:

  • You have been left the entire estate;
  • There are no executors named in the will;
  • The executors are not prepared to accept the role.

Benefits of using probate solicitors

Whilst it is possible to handle probate of a deceased’s estate yourself via online probate services, sometimes the legal terminology and probate service can be complex and confusing if you don’t have a legal background. 

If the deceased’s estate is fairly simple and they left a detailed will setting out their wishes, as well as how the estate was to be distributed, then handling the probate process online should be pain-free.  However, if the deceased’s estate large and complex, or other factors that may make the probate process complicated, using a probate solicitor may be the best option.

Situations where probate cases are more complex and it is probably better to enlist the services of a probate solicitor include:

  • If there is a dispute about the will or questions on whether it is valid;
  • Where a beneficiary that may have been left out of a will deliberately by the deceased and they want to make a claim;
  • Where assets may be held in a trust or the will states that a trust must be created;
  • Where the estate is insolvent or bankrupt;
  • The deceased either lived abroad or died abroad; and
  • The estate includes property or assets that are foreign to the UK.

In these situations, a specialist probate solicitor will have the knowledge and expertise to be able to advise and administer the deceased’s estate.  In addition, by using a probate solicitor you will pay a reduced probate application fee, which currently stands at £155.

Benefits of using online probate solicitors

Using online probate solicitors does not mean you are not getting professional advice and service.  You will still be talking to a legal professional that specialises in probate.  The essential differences between an online service and a physical service are:

  • Generally, the solicitor’s fees will be cheaper as there are fewer overheads for them to cover, making the use of their services far more affordable.
  • They are more readily available 24/7 as your queries are presented online to a pool of online probate solicitors.
  • There is no requirement for face-to-face meetings – all communication is carried out via email and/or telephone.

Online probate solicitors are registered in the same way as non-online solicitors and have to abide by the same rules.  They are more than capable of handling uncontentious wills and subsequent probate applications.  However, you may find that when it comes to complex probate cases or estates where the deceased did not have a will, an online probate solicitor service may not be able to help you as effectively. 

Now that it is mandatory for all probate applications to be submitted online, whether a solicitor is applying for grant of probate or the executor(s)/administrator, it is not always necessary to go through non-online solicitors.  However, with that said, if the deceased’s estate is large and complex, or any of the above situations apply, a non-online probate solicitor may be in a better position to administer the estate and deal with the complex issues on your behalf. 

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 or would like to take advantage of our entire Estate Administration service, visit our website for more information or contact us today.