Dealing with someone's estate after their death
How you deal with someone's estate – their money, property and possessions – after they die depends on whether they...
What is an executor?
Whether someone's asked you to be the executor of their estate, or you’re looking to choose executors for your own will, the legal things surrounding wills and estates can seem complicated.
What is an executor?
An executor is legally responsible for carrying out the instructions in the person's will and handling their estate. Someone's 'estate' is everything they own – including their money, property and possessions.
Can I have more than one executor?
Anyone who makes a will must name at least 1 executor, and can appoint up to 4 executors so that the responsibility is shared. If there's more than 1 executor, all decisions must then be made jointly. Often, at least 2 executors are appointed, just in case one dies or is otherwise unable to carry out their duties.
Who should I choose to be an executor?
You can act as an executor even if you're going to inherit something from the will. In fact, an executor is often a spouse, child or other family member.
How do I choose executors for my will?
Being an executor isn't easy. It can take up a lot of time and energy, and it might be the last thing someone feels like doing when they're grieving. So it's important that you think carefully about who you choose – explain what’s involved and make sure that they're willing to take on the responsibility of the role.
If someone's asked you to be an executor of their estate, think carefully before you agree to take on the responsibility because it's tricky to step down from the role. For example, if the person's died and you've already started to deal with the estate, you can't step down unless you have a good reason, such as ill health or a family emergency.
What if I don’t have anyone who can be an executor?
If you don’t have anyone that you feel would be suitable, or your family and friends don’t want to take on the role, you could appoint a professional executor, such as a solicitor or an accountant. This can be especially useful if your estate is particularly large or complicated. A professional executor will charge for their services and this will be paid for out of your estate.
How do I find a solicitor?
The Law Society provides a directory of solicitors on their website.
What do executors do?
If you’re the executor of the estate you’ll have a number of responsibilities, such as:
- making sure the property owned by the person who's died is secured as soon as possible after the death
- collecting all assets and money due to the estate of the person who's died (including property)
- paying any outstanding taxes and debts (out of the estate)
- distributing the estate to the people who are entitled to it under the terms of the will
- arranging the funeral – whether or not the will contains specific instructions to do so.
You can claim reasonable expenses from the estate for your work, such as funeral costs and grant of probate application fees. Solicitors can help you with your role as an executor, though you'll need to pay them for their time.
How do I apply for probate?
A grant of probate gives you the legal right to deal with someone’s estate.
You may not need a grant of probate for a smaller estate (usually less than £5,000).
In this case, write to the deceased person's bank, building society or whoever's holding the money and ask whether they'll make a payment to you without receiving a grant of probate.
Applying for a grant of probate via post
- You'll need to complete a PA1P form and the relevant Inheritance Tax (IHT) form. Call the Probate and Inheritance Tax Helpline on 0300 123 1072 to request these forms.
- Send the completed forms to the local Probate Registry along with an official copy of the death certificate, the last original will and any codicils (a document outlining a small amendment to the will) and the £273 fee, plus £1.50 for each extra official copy of the grant (you'll need a copy for each asset holder).
Applying for a grant of probate online
You can apply for a grant of probate online on GOV.UK. You can pay online and you'll need to send a copy of the will separately. You'll be asked how many copies of the grant you need.
How do I value the estate?
If you're the executor, you'll need to value the estate of the person who's died.
Start with everything that they owned at the time of their death. This includes property, possessions and money, minus any debts they owed, such as a mortgage, loans and bills. The estate may also include assets held jointly with others.
For assets such as property or land, you should get a professional valuation.
HMRC recommends having items worth more than £500 valued professionally.
How do I pay Inheritance Tax?
Inheritance Tax (IHT) may have to be paid on the estate if it's worth more than the £325,000 threshold. If a house the deceased has lived in is left to their children or grandchildren, the tax-free allowance on its value increases to £500,000. After that, the tax payable is 40%.
There’s no IHT to pay on estates left to a spouse, civil partner or charity. If one partner dies and hasn’t used their tax-free allowance, this can be passed on to the surviving partner, giving them a higher threshold of up to £1,000,000 before IHT applies
If there could be IHT to pay, get a professional valuation on high-value items such as a house or stock market investments, as you'll need to give HMRC a detailed account along with valuations.
If the valuations aren't accurate, you may have to pay penalties.
You can download an IHT form online on GOV.UK or you can order a form by calling the Probate and Inheritance Tax helpline on 0300 123 1072.
How do I distribute the estate?
These are the main tasks involved in distributing the estate:
- If the will states a specific item of personal property is to be given (‘bequeathed’) to someone, you can do this before probate is granted – but make sure you have the items valued and there are sufficient funds to pay any IHT from other assets.
- Once all the assets have been collected and all the bills have been paid, draw up estate accounts for each beneficiary. Estate accounts show details of all the money that's come into and out of the estate (including assets and debts) as well as the final amount to be distributed to the beneficiaries.
- Beneficiaries who are bankrupt may not be entitled to receive their inheritance, so it's a good idea to carry out bankruptcy searches using the Individual Insolvency Register on GOV.UK.
- Distribute the estate in accordance with the terms of the will, making sure at least 2 trustees are named for any gifts left to beneficiaries under 18. You may want to wait 10 months after probate is granted before distributing the estate in case any claims are made against it. If you don't, you and any other executors are personally responsible for any claims that arise later down the line.
- Give each beneficiary an R185 tax form for their share of estate income. You can call the Probate and Inheritance Tax Helpline on 0300 123 1072 for more information about this.
- Make sure you keep clear records of the work you’ve done so you can answer any questions and challenges over how you administered the estate.
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