This is one of a series of articles about wills and probate. An overview of the probate process and an explanation of the legal terms can be found in the first article of this series.
This article provides information on how to apply for probate once you have carried out an inventory of the estate.
Complete the forms required to apply
Before applying for probate, you need to complete a number of forms. These include the actual probate application form, but also forms that determine whether inheritance tax is due on the estate.
You can obtain the forms from either the Principal Probate Registry or any district office. Return them by post to the Principal Probate Registry.
If you need to complete it, HMRC provides Form IHT 400.
Form PA 1 - Probate Application Form
The purpose of this form is to collect basic information about the testator, the will, the beneficiaries, the family and the executors. Using this information, the Probate Registry can determine:
- who should be granted probate or letters of administration;
- whether power reserved letters should be issued;
- who might be a beneficiary in case of intestacy or partial intestacy; and
- whether any beneficiaries are minors, in which case a trust is formed.
Form IHT 205 - Short Form of Return of Estate Information
This form is completed for estates that are excepted, or exempt and excepted. It determines whether you need to complete form IHT 400.
Form IHT 400
This form determines whether inheritance tax is payable. You probably won’t need to complete all sections of the form, but you may need to complete supplementary pages or attach separate sheets.
At the Probate Registry
After having returned the forms, the Probate Registry contacts the executors with an appointment for an interview. All executors are required to attend the interview to swear an oath. The executors must take the original will and Form IHT 205 with them.
At the interview (before the grant of probate is issued) the executors must pay the probate fees and any inheritance tax due. Because you might not have been able to collect in assets of the estate by this time in the process, it may be necessary to arrange a loan to pay the fees and tax (seeing paying fees and tax below).
The executors are required to swear an oath that the information they have provided to the Probate Registry and to HMRC is correct. You may want to take evidence that supports the valuations and information provided. Afterwards, the oath and the will are signed by each executor and the commissioner for the case.
Copies of the grant of probate or grant of letters of administration can be ordered. This is a good idea to reduce the time taken to have the transfer of assets to the executors authorised by the organisations that hold the assets of the deceased. If you send off your only copy to one, you’ll have to wait until it is returned to be able to send it to the next.
If no inheritance tax is due, a grant will be issued and sent to the executors (or administrators) with the additional copies ordered by post soon after the interview.
The grant is proof that the executors or administrators have the power to collect the estate and distribute it.
Paying fees and tax
A bank or building society is unlikely to let an executor withdraw the funds in the deceased’s accounts until probate has been granted. Since that does not happen until inheritance tax and the probate fee have been paid, the executors may need to arrange payment by means other than bank savings. There are a number of options.
Most banks and building societies participate in the Direct Payments Scheme (DPS). Executors can apply for the bank to liaise with HMRC and organise payment directly.
Similarly, executors can request that the Probate Registry contacts the National Savings Office to use National Savings, National Savings Certificates or Premium Bonds of the deceased. The two organisations can arrange payment between themselves.
Funds in pensions and friendly societies might be available to the executors to withdraw, but this is only likely if the total in any single fund is less than £5,000. You will need to contact those organisations individually to determine their policies.
Assets and personal possessions could be sold by executors (but not would-be administrators) to raise the money required. You might be able to sell jewellery, cars, furniture, and possibly shares (subject to a nominee stockbroker’s agreement).Or the executors might borrow money
There may be funds payable to others that haven’t yet been distributed that can be used. For example, you might be able to use part of lump sum death benefits from a pension fund, written in trust for someone else. Those funds still belong to the person to whom they are payable, but the executors might be able to borrow them.
Banks often can lend to the executors, but for a fee and with interest. Income tax relief can be claimed on the interest for the first year of administration.
Alternatively, a beneficiary may be able to lend money, particularly if he or she saves on the fee and interest that a bank would charge if a bank lent the money instead.
We have a number of articles on probate that you should find useful to read. We also have another series on writing a will that provides much background information for anyone interested in probate.
If it is a long time since you made a will, or if you haven't yet made one, you might like to do so. To help, we provide a number of free last will and testament templates (likely to be suitable for most people).
If you need any help choosing, just contact us.