When someone dies, there are practical and legal matters that need to be dealt with, from their home and bank accounts to debts, tax and what happens to anything they leave behind. Suddenly, understanding Probate and Inheritance Tax (IHT) becomes essential.
For families, it can be difficult to know what is involved, particularly when they are also dealing with the loss of someone close to them. Some estates are relatively straightforward; others can be much more complicated.
What happens to someone’s affairs after they die?
When a person dies, their assets and liabilities need to be identified and dealt with. This might include their home and other property, bank and savings accounts, investments, personal possessions and any debts or other liabilities.
Usually, the executor named in the Will is responsible for dealing with these matters. If there is no Will, an administrator will normally take on the role.
The executor needs to establish what the person owned and owed, deal with any tax and debts, and ensure what remains passes to the people entitled to inherit it.
Does the Will decide everything?
Not necessarily.
A Will is important, but it doesn’t automatically determine what happens to everything someone owned. How an asset was held can make a difference.
For example, jointly owned property may pass to the surviving owner rather than under the terms of the Will. Some pensions and life insurance policies may also be dealt with separately.
This is why administering an estate can involve more than simply finding the Will and following its instructions.
Understanding Probate – Does every estate need it?
No.
Probate is the legal process of obtaining authority to deal with certain assets belonging to someone who has died. Whether a grant of Probate is required depends on the nature and value of the assets, how they were held and the requirements of the individual organisations holding them.
Some smaller or straightforward estates can be dealt with without Probate.
If someone dies without a Will, the person dealing with the estate may instead need to apply for letters of administration.
Why can some estates be complicated?
An estate involving a home, some savings and a straightforward Will may be relatively simple.
Things can become more complicated where:
- Inheritance Tax (IHT) may be payable
- There are overseas assets or property
- The person owned a business or had trusts
- There are significant debts
- The validity of the Will is questioned
- Family members disagree or someone makes a claim against the estate
These circumstances can affect what needs to happen and whether professional advice would be helpful.
Do you need a solicitor?
Not necessarily. An executor can often deal with a straightforward estate themselves.
However, administering an estate comes with responsibilities. Understanding Probate responsibilities, mistakes involving tax, debts or the distribution of assets can have consequences.
Legal advice can be particularly useful where there is uncertainty about the Will, property, tax, trusts, overseas assets or disagreement between beneficiaries. You don’t necessarily have to hand over the whole estate either; a solicitor can advise on a particular issue or deal with the administration for you.
Dealing with an estate after someone dies
Understanding Probate and Inheritance Tax (IHT) in order to deal with someone’s affairs can feel overwhelming, particularly when you’re grieving. There is no single process or timescale that applies to every estate.
If you’re responsible for dealing with an estate and aren’t sure what needs to happen, our specialist Wills and Probate team can explain your options and advise you on probate and estate administration – Call or Email our experts today.
