When is probate required? An overview of UK financial institution thresholds

When someone passes away, probate may be required before their assets can be dealt with. This blog discusses what probate is, when it's required, and the probate thresholds of some UK financial institutions.

What is probate?

Probate, also known as Grant of Probate, may be needed when someone passes away. Obtaining probate provides the Executor(s) or Administrator(s) with the authority to act on behalf of the estate and proceed with the estate administration process.

To better understand probate and estate administration, the following key terms are worth noting:

• Executor(s) – acts in estates where a Will was left
• Administrator(s) – appointed to handle an intestate estate (when there is no Will)
• Personal Representative – the umbrella term for Executors and Administrators
• Letters of Administration – acquired instead of a Grant of Probate in an intestacy case
• Confirmation – the equivalent of a Grant of Probate in Scotland
• Grant of Representation – the umbrella term for Grant of Probate and Grant of Letters of Administration

Although probate is not needed for all estates, estate administration must always be carried out.

How much does an estate have to be worth to go to probate?

Whether probate is required does not depend solely on the value of the estate. Instead, it relies on how the assets are held and which financial institutions they are held with.

When is probate required?

When assets are held solely and the balance exceeds their probate threshold, financial institutions may need to see a Grant in order to release funds. This threshold varies as it is set by the individual institution rather than by the Government. Therefore, it may be a timely task to contact each institution where the deceased held assets to understand their requirements.

When is probate not required?

Generally, probate isn’t required if the estate is valued at less than £5,000, as most financial institutions will release funds lower than this.

Also, if assets were held jointly, probate is often not required as these assets automatically pass to the surviving spouse or civil partner. However, some jointly held assets, such as property, may need a Grant if specific arrangements have been made during lifetime. For example, if the property is owned by tenants in common rather than joint tenancy.

Is probate required if there is a Will?

Probate may still be required if there is a Will. If there are solely owned assets and the value of one or more asset(s) exceeds the relevant financial institution’s threshold, probate is most likely required, whether the person passed away with a Will or intestate. If the individual has passed away without a Will, the Administrator will need to apply for Letters of Administration rather than a Grant of Probate, but the thresholds and requirements remain the same.

Current probate thresholds for UK financial institutions

Financial institutions, such as banks or building societies, may decide whether probate is required on a case-by-case basis, or they might have a set threshold. Probate thresholds vary greatly from institution to institution, typically ranging between £5,000 and £50,000. As these thresholds are subject to change by the individual institution, it is recommended that you check with the relevant institution when required.

These probate thresholds are subject to change by the institutions they refer to; they are accurate to the best of our knowledge as of August 2023. If you are administering an estate, please confirm whether you need a Grant of Probate with each institution directly.

What is the probate process?

The probate application process involves completing a PA1P (if there is a Will) or a PA1A (if there is no Will). Deaths dated on or after 1 January 2022 that meet the excepted estate criteria do not require an Inheritance Tax (IHT) form. If the estate does not meet the criteria, an IHT form will also be required. Find out more about IHT reporting for excepted estates.

All these details, plus the death certificate, must then be sent to the Probate Registry. Probate can be applied for online if you have the original Will and death certificate, but documents will still need to be sent by post after submission.

How long does it take to get a Grant of Probate?

It should take up to 8 weeks from application to receiving the Grant of Probate. However, backlogs at the Probate Registry mean that applicants are experiencing significant delays, which are usually worse for those submitting paper applications.

Additional interruptions to the process can occur when there are mistakes in the application; this could lead to a stopped application. Common errors to look out for are missing documents and queries about the Will’s condition (e.g. ripped or missing pages). Our blog explains what can be done to reduce the risk of a stopped Grant of Probate application.

How much does a Grant of Probate cost?

There is a set government fee for obtaining probate in England and Wales which has recently been raised to £273 for estates over £5,000. For estates that are £5,000 or less, there is no fee to pay. Learn how probate fees can be paid.

What happens if the Executor does not apply for probate?

When probate is required, there is no official time limit for when the Executor should apply. However, waiting to start the application process means that estate administration cannot begin and causes delays to distributing inheritance. Therefore, the Executor could be at risk of claims against the estate from unhappy beneficiaries if they do not apply within a reasonable period.

In addition, if IHT is payable on the estate, it is best to pay it by the end of the sixth month following the death – after this, interest charges are added. IHT forms must be submitted before the probate application, as the court will not issue a Grant until after it has been paid. If the Executor does not apply before interest charges begin, they risk reducing the value of the estate for the beneficiaries.

What can be done before probate is granted?

There are certain tasks that can and should be completed before applying for a Grant of Probate, including:

• Obtaining the medical certificate
• Registering the death with a register office
• Locating the Will and other important documents
• Arranging the funeral
  
  

What happens after probate is granted?

Once the Executor or Administrator has the Grant of Probate, they have the legal and financial responsibility to administer the estate. In summary, this includes dealing with all of the deceased’s assets, property, debts, tax work, and distributing inheritance to the beneficiaries as named in the Will (or under the rules of intestacy if there is no Will).

The Personal Representative does not need to apply for probate or administer the estate themselves if they don’t want to; they can instruct a professional to carry out the process on their behalf. Here at Kings Court Trust, we offer four specialist estate solutions, from Grant only to full estate administration. We can take care of the complex paperwork and stressful tasks associated with a bereavement to alleviate some of the burden when a loved one dies. The benefits of instructing us to obtain the Grant of Probate or administer an estate include:

• Free, impartial advice and a no-obligation fixed fee quotation for our services
• A dedicated point of contact throughout the Grant of Probate application and/or estate administration process
• We can take on the full legal and financial responsibility when administering the full estate
  
  

If you have any questions about applying for probate or the estate administration process, get free guidance and advice from our Client Services Team by calling 0300 303 9000 or filling in the form below.