Dealing with a loved one’s affairs after they die can be difficult.
Probate is the legal and financial process of dealing with the property, money and possessions (assets) of a person who has died.
The assets are then distributed as inheritance – after paying any taxes and debts.
If processes are put in place in advance, such as a complex Will and Trust as needed, this should be relatively straightforward.
But probate can cause heartache and headaches should the Will be challenged, assets lost or the family left with unnecessary hefty bills.
Here at Kinherit we can help with problem probate should it arise.
1. Inheritance Tax (IHT)
Inheritance Tax applies when an estate is worth more than £325,000 – and this is doubled for married couples. Thereafter assets are taxed at 40 per cent.
However, many fail to plan for this when they are alive and leave behind a hefty bill.
It can lead to a six figure bill and risk loved ones having to sell the family home to pay for it.
We have helped clients reduce this bill drastically through a Deed of Variation, which involves changing a person’s Will after they’ve died.
This has to be done within two years of the person dying and on the provision that the beneficiaries agree to the changes if they are left worse off.
We can help put the funds in a Trust and the fee is more than covered with the savings which are made. For example, we helped reduce one IHT bill by £140,000.
Delays to probate are common for a variety of reasons, such as a contested Will and lost assets, which we will look at below.
Another reason may be that one family member refuses to honour the Will. We work with everyone as an independent, impartial party to find the best way forward.
We recently worked with a client whose sister refused to move out of the family home nearly five years after the parent had died – therefore depriving him of his share of the inheritance.
We were able to put legal processes in place to ensure he got his fair share within a short period of time.
3. Contested Wills
Contested Wills are on the increase and some can go on for years, making the assets untouchable. Contestation is a costly and time consuming business.
Creating a more watertight Will in the first place helps protect against this. This may include statements around those you choose to leave out, so it does not appear to be an oversight.
4. Finding assets
It is not uncommon for family members to have to search through the deceased’s home in a bid to find paperwork around possible assets.
Needless to say, this is not a failsafe approach and loved ones can lose out simply because they do not know what they are entitled to.
According to government figures, the value of unclaimed estates in the UK could run into the billions.
If the deceased has not registered their assets, then probate will inevitably be a slower and more costly process.
With this in mind, the team at kinherit has designed an online vault, to store anything from bank to jewellery details.
5. The handover
Executors or administrators are responsible for an estate, its assets and for obtaining a Grant of Probate before distributing the estate to the beneficiaries named in the Will.
A Grant of Probate is the legal document which confirms the executor has the authority to deal with the deceased’s assets.
Disputes can arise if some parties believe the executors or administrators are failing to perform their duty.
There may be ways to resolve the issues, without having to go to court, such as requesting an inventory and account of the administration in the first instance.
But with this in mind, we offer a handover service at Kinherit. We speak with the appointed executor and inform them of their role and duty – while the client is alive. We support them in their role, to ensure greater peace of mind for all concerned.
It is our strong belief at Kinherit that prevention is better than cure. Planning in advance can help prevent problem probates.
We work with clients to understand their circumstances and ensure their end-of-life planning fulfils their final wishes. We will advise where a more complex Will or Trust will be beneficial, for example. We also provide a complementary registrar of assets, through our Kinvault, and a handover service.
We believe in having open and honest conversations with our clients. Where we cannot help, we can put them in touch with someone who can.