Everyone should have an up-to-date Will.
While a Will is no guarantee against a dispute about your estate after death, an up-to-date and professionally-drawn Will, made when you are in good health, is a good step towards avoiding claims against your estate.
A Will can perform all the following functions:-
- Express your wishes for the distribution of your estate on death
- Appoint Executors: these are the people who administer your estate after your death
- Name guardians to look after your minor children when there is no responsible parent
- Give funeral and other directions
- Give your Executors the powers they need to deal with your estate efficiently, economically and according to common sense
- Ensure that you make the best use of Inheritance Tax exemptions and other tax allowances and reliefs available
Probate and Estate Administration
If you are, unfortunately, reading these paragraphs following a bereavement, we understand that this is likely to be a difficult time. The following notes on procedure for dealing with an estate are set out for reference in order for us to focus on essential details when you attend our Office and, hopefully, avoid a prolonged interview which might have been distressing for you.
A Solicitor is sometimes contacted very early because there is known to be a Will and the immediate family of the person who has died, or someone who has taken responsibility for practical arrangements, feel that they should check whether there are any wishes in the Will which they need to know immediately, such as funeral directions.
If there are life policies, shares, property or bank balances above certain amounts, it will usually be necessary for the person(s) dealing with the estate to apply for a type of Court Order known as a Grant of Representation before the policy proceeds can be claimed, shares or property sold or bank accounts closed.
Grants of Representation are issued by the Probate Registry – part of the High Court of England and Wales.
In order to apply for a Grant of Representation, enquiries must be made to find out what assets are in the estate and their value: the value of the estate must be declared to HM Revenue & Customs in an Inheritance Tax Return. If the value of the estate after debts and funeral expenses is more than the Inheritance Tax Nil-rate Band, Inheritance Tax may be payable. The value of the estate must also be sworn or affirmed in the Oath or Affirmation which is sent to the Probate Registry.
If there is a valid Will which appoints Executors, the type of Grant of Representation which must be applied for is a Grant of Probate, sometimes referred to as Probate for short. This is also known as proving the Will. The person whose Will is being proved is known as the Testator.
If there is no Will or there are no appointed or willing Executors, a different type of Grant of Representation has to be applied for, usually by the persons entitled to the estate or part of it: this is a Grant of Letters of Administration – or just Letters of Administration. The persons to whom Letters of Administration are granted are known as Administrators.
Executors and Administrators can both be referred to as Personal Representatives, or PRs. One important difference between them is that because Executors are appointed by Will, they have authority to deal with the estate immediately after the Testator’s death – although they may still need to obtain a Grant of Probate to realise assets. Administrators, however, are only “appointed” by the Letters of Administration and have no authority before the Grant is issued, meaning that they have more limited ability to make progress: making sure that you have suitable Executors and keeping your Will up-to-date would avoid this.
If there is no Will, the estate of the person who has died (the Intestate) passes according to the Intestacy Rules.
Other Private Client Services
As well as drafting Wills and helping Personal Representatives to obtain Grants of Representation and administer estates, Clients may need some of the following services:-
- Post death Variation: the terms of a Will or the application of the Intestacy Rules may be changed by Deed after the Testator or Intestate has died, if everyone affected by the proposed change agrees and has full legal capacity (is not under a disability or bankrupt etc). A Deed of Variation may be desired because for instance the terms of the Will or distribution of the estate according to the Intestacy Rules is felt to be inappropriate, or because the original beneficiary wishes to make a gift and there is unused Inheritance Tax Nil-rate Band in the estate of the Testator or Intestate which means that the gift can be carried out more tax-efficiently by re-routing it through the estate.
- Trusts: drafting of Gifts into trust/Settlement deeds; also administering trusts. Trusts are often thought of as something which only wealthier Clients need, or as too complex or expensive to be relevant to most people: however, this is not so, as a trust always comes into existence by law whenever someone under the age of 18 becomes entitled to a gift under a Will or to a share of an estate on Intestacy.
- Lasting Power of Attorney: a person (the Donor) may wish to appoint someone else (an Attorney) to look after their financial affairs or some aspect of them, or to take decisions about their care, welfare and medical treatment. This is achieved by means of a Lasting Power of Attorney (LPA). There are separate powers to deal with Property and Financial Affairs and Health and Personal Welfare. It is not possible for the Attorney to begin acting until the LPA has been registered with the Office of the Public Guardian.
- Registration of Enduring Powers of Attorney (EPAs) when the Donor becomes or is becoming incapable of managing his or her financial affairs. There are still lots of these around and this will continue to be relevant for many years to come, although it is no longer possible to create new EPAs.