Administration of Estates
When a person dies it is necessary for someone to have the authority to sort out the estate, collect the assets, pay any debts and pay the estate to the right people. Where there is a Will that authority is called a Grant of Probate which is obtained by making an application to the Probate Court. Where there is no Will the authority is called Letters of Administration.
Although there are differences in all estates the usual process can be summarised as follows:
Stage 1 – meeting you to understand how the estate is structured; what are the assets; what are the debts; and checking the funeral arrangements. At this stage we will explain the responsibilities of the executor.
Stage 2 – valuing the estate by contacting the banks, building societies and other investment holders and any creditors. We obtain valuations of any properties and shareholdings.
Stage 3 – preparing the application for the grant and the HMRC account of all the assets and liabilities. At this stage Inheritance Tax may have to be paid. We will work with you to agree how any payment is made.
Stage 4 – Grant of Probate/Letters of Administration. This is the formal authority to enable the estate to be completed and payments made.
Stage 5 – registering the Grant. The Grant must be sent to all the asset holders so that payments can be made and assets sold or transferred.
Stage 6 – paying the debts. When the funds have been collected in any outstanding debts are paid.
Stage 7 – paying legacies. Any specific gifts of money or items are made to the relevant individual or organisation. Property and share transfers are completed.
Stage 8 – finalising Inheritance Tax, if any. We will agree the final tax bill with HMRC.
Stage 9 – final accounts. A detailed set of accounts are prepared to set out the financial history of the administration of the estate. Final payments are made to residuary beneficiaries.
Grant only applications can usually be completed within 3 months. Full administration will take longer but most straightforward estates are completed within 12 months with simpler estates being dealt with in a shorter period. Complex estates, including those that include trusts or a possible dispute, will take longer. This will be discussed when we meet with you and we are able to give our best estimate of the timescale.
What we do
With our significant experience of the process we are able to take away the administrative burden of finalising the estate. This makes it easier for you at a difficult and stressful time.
There are several pitfalls and possible issues as well as a number of opportunities which may arise during the course of the administration. With professional advice to assist an executor these will be spotted and considered early in the process.
Examples of these include:
- Preparation of a deed of variation to redirect the distribution of the estate in a manner that is efficient for inheritance tax purposes
- Ensuring that capital gains tax (CGT) allowances available to the executors and the beneficiaries of an estate are properly utilised to minimise CGT liability
- Protecting executors from potential claims from disappointed beneficiaries
- Making use of reliefs, allowances and exemptions to minimise the Inheritance Tax bill
- Registering the estate with HMRC for the purpose of the Estates and Trust Register to avoid penalties for non-registration
The fees for the administration of a deceased's estate will vary depending on the complexity and value of the estate. Consequently Belcher Frost has a range of costs for Probate work.
Grant of Probate only
Obtaining the Grant of Probate only will be charged at a fixed fee. This work will include gathering information about the assets of an estate and submitting an application only. It does not include arranging the payment of inheritance tax or collecting and distributing assets. The cost for this work ranges from £1,000 to £3,000 plus VAT and will depend on:
- The number of assets and liabilities within the estate
- The inheritance tax form that needs to be submitted – more complex estates require the completion of a longer more detailed form
The fees are usually based on an hourly rate for our work plus a percentage (between 0.5% and 1%) of the gross estate plus VAT and any payments which may need to be made to a third party on your behalf. Our hourly rates range from £185 for a junior solicitor to £250 for the senior partner. For some elements of the work we are able to work on a fixed fee basis.
As a guide, based on our experience, the combined total of the above means our fees often fall between 2% and 3% of the gross estate plus VAT but can be as low as 1% for high value straightforward estates or as high as 5% for small but complex estates.
As an example to administer a simple non-taxable estate with the work undertaken by a junior solicitor the total fee should be between £2,500 and £5,000 plus VAT and disbursements. Please note that some expenses (disbursements) may be subject to VAT. Examples of disbursements include Probate Court fees; bankruptcy searches; notices in a local newspaper or the London Gazette.
Before any work is carried out we will send you a comprehensive pricing proposal providing you with the option of having the work done as above or just on an hourly rate basis or by way of a fixed fee. We are able to work on the basis of completing all the administration of the estate or taking it to the stage of obtaining the Grant so you can take on the remaining stages.
There are a number of expenses that have to be paid in addition to our charges. The major payment is the application fee for the Probate Court, currently charged at £155 and £1.50 per copy of the Probate.
There are occasions when the costs may increase. These could include:
- Where there is no Will
- The estate consists of stocks, shares and/or bonds
- Where there is a property to be sold or transferred
- Where complications arise due to the nature and/or amount of the estate assets and/or the number and/or circumstances of the beneficiaries
For an estimate specific to your matter please contact one of the private client team on 01243 377231 or click here to send us an email.
Our Probate Team:
Residential Property Services
Set out below are the costs we charge for the range of residential property work. These are illustrative estimates relating to the purchase of a freehold property at a price of £325,000 assuming there will be a mortgage on the property.
We will agree fixed fees with you which are based on certain assumptions which will be appropriate for most transactions.
We do not charge separately for completion of an SDLT return or other aspects of the transaction which are standard requirements when buying or selling property. The fee quoted includes all these costs.
Please note there are some factors that may affect the cost of the matter. These include if part of the property is unregistered or planning permission/building regulations have not been obtained. Should additional work, which has not been included in the quoted fee, is required we will discuss this with you prior to incurring any additional costs.
We will occasionally refer to disbursements. These are elements of the matter where costs payable to another agency on your behalf. Examples of these include search fees, Stamp Duty Land Tax fees.
Please note these figures are based on our experience of dealing with previous cases. The prices are estimates for a standard matter.
|Purchase of freehold house at the purchase price of £325,000-|
|Our professional fees||£795.00||VAT||£159.00|
|Lender Legal Fee||£100.00||VAT||£ 20.00|
|Land Registry Fees||£135.00|
|Local & Environmental Search Fees||£165.00||VAT||£ 33.00|
|Land Registry Search Fee||£ 3.00|
|Money Laundering||£ 5.00||VAT||£ 1.00|
|Money Transfer Fee||£ 30.00||VAT||£ 6.00|
Please note if the property is leasehold there will be an additional fee of £200 plus £40.00 VAT (£240.00).
This is an illustration only. For an estimate specific to your matter please contact one of the residential property team on 01243 377231 or click here to send us an email.