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Probate is a vitally important part of the Will process. This is dealing with the valued, and often treasured, possessions, property and money (assets) left by the person who has died. Attempting to deal with probate without involving solicitors is a tempting proposition for many personal representatives. They can be either the person named in the will, or the person entitled to administer the estate where there is no will. That personal representative of an estate may believe that they are able to deal with the administration of an estate and avoid legal fees. Whilst this may be true in straightforward cases, where there are more complex affairs to deal with or inheritance tax to pay, a DIY approach can represent a false economy.
Administering an estate can be a daunting task. It often involves extensive enquiries into debts, assets, pensions, lifetime gifts and the deceased’s income tax affairs. Even with the best intentions, a lack of knowledge of the practical steps required and the legal intricacies can lead to unnecessary problems, costs and mistakes.
The process can take the form of a Grant of Probate (where the deceased had a will) or Grant of Letters of Administration (where the deceased died without a will). Probate is likely to be needed where the deceased:
Professional and lay (unqualified) executors have the same duties to the estate’s beneficiaries and, where tax is payable, to HMRC. A professional can draw on years of training and practical experience in relation to succession and tax law. This is unlikely to be the case for a lay executor.
For instance, take this example of the strict legal responsibilities placed on a personal representative. The recent unfortunate case of an executor acting without legal representation: Harris v HMRC  UKFTT 204. Here, the executor distributed the estate to its beneficiaries without paying circa £340,000 of inheritance tax due to HMRC. As a result the executor was unable to recover the funds from the beneficiaries. They were therefore held to be personally liable for the sum due to HMRC.
Where an estate is taxable, the responsibility and risk to personal representatives increase substantially. Due to the recent changes to inheritance tax law an additional inheritance tax allowance, known as the residence nil rate band, makes it very easy to be overlooked by a personal representative. The cost to the estate in the loss inheritance tax relief alone could be as much as £140,000.
There are many reasons for taking the DIY route, the main one being to save money. However, failure to follow the correct procedures could cost you dearly further down the line.
Instructing a solicitor to deal with the probate and administration of an estate is a wise investment from both an emotional and financial standpoint. It could save you greatly in the long run.
Our probate team are all qualified solicitors and legal executives with many years’ experience. They are experts in dealing with not only the application process, but also with taxation issues, HMRC and other third parties.
Get in touch with us to ensure you are making an informed decision. We can discuss all of your options so that you can move forwards with peace of mind.
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