Estate administration is a term slowly becoming more commonly known. One of the challenges we face is around public perception and education; currently, probate is the common term used to describe the estate administration process. As a business providing this service to families all across the UK, we receive questions about estate administration, probate and everything in between. In this blog post, we sit down with our Head of Service Delivery to explore the answers to four of our most asked questions around probate and estate administration.
Charlotte Toogood is the Head of Service Delivery here at Kings Court Trust. She is a STEP qualified solicitor, specialising in high value, complex and technical estate administration. We sat down with Charlotte to get her take on four of our most asked questions:
1. What is the difference between probate and estate administration?
Probate is a term that a lot of people would’ve heard but it’s just one part of the estate administration process. When somebody passes away you need to obtain probate, or the Grant of Representation which is what we like to call it at Kings Court Trust. This is ultimately the legal document issued by the Probate Registry confirming who has the authority to deal with the estate. This document is then provided to the institutions to deal with the assets and debts within the estate. As a lay person, perhaps as the Executor, you might think “once you’ve got probate, you’re done and there’s not much else to deal with apart from collecting in the assets”, however, there is so much more. Obtaining the Grant of Representation is the authority to deal with the estate but then comes the responsibility involved in dealing with the assets. For example, if you are administering an estate that has a property, once you’ve obtained the Grant of Representation, you then may need to deal with the sale of that property. The property needs to be cleared, an estate agent appointed and a conveyancing solicitor instructed to assist with the property transaction.
It can also be the simple things like dealing with the postal redirection that, as an Executor, you wouldn’t think to deal with. When somebody passes away, an Executor or family members aren’t always around the corner from the property. There’s the responsibility of visiting the property on a monthly basis to collect all post from the institutions. If postal redirection is set up – and this isn’t necessarily something that you may think to do – that issue is dealt with. It is the little things like this that will be completed in an overall estate administration service.
2. What are the common problems you see when Executors attempt probate themselves?
A lot of the time we see people tend to DIY the estate administration on a first death estate - when it’s a spouse and the husband/wife has passed away and the other is left to deal with the estate. For example, we have come across estates where the families just aren’t aware of the intestacy rules. They presume everything will pass to the husband or wife but actually, there are rules that need to be followed. When the estate is over a certain amount (£250,000) and there are children, some of that estate will have to pass on to the children.
We also commonly find that when someone passes away with a Trust in the Will and the individual does it themselves, they may not realise 1) the options for that Trust, 2) they don’t always have to follow what’s in the Will and there is flexibility, and 3) making sure they put assets into the Trustees names if they do want it to continue. We get a lot of second death estates where it’s difficult to try and collect in the information to claim in the Transferrable Nil Rate Band simply because we’re unaware of what should be in the Trust as it’s just sat in the surviving spouse's name or a family member’s name.
3. Are there any specific issues in terms of personal liability for individuals?
If an Executor is named on the Grant of Representation, they are personally liable for the estate administration responsibilities. At Kings Court Trust, when we’re dealing with the estate administration, we will offer Executors a Power of Attorney (PoA). Our PoA’s are limited to the estate administration and it means the Executors would appoint Kings Court Trust to deal with the estate on their behalf. The benefit of this is Kings Court Trust’s name is on the Grant of Representation and we would then be personally liable for dealing with the estate including dealing with HMRC in relation to questions around Inheritance Tax or Income Tax. If it’s an individual’s name on the Grant of Representation, they need to be sure that they have completed everything and distributed the estate to the correct beneficiaries.
4. What are the benefits of using Estate Administrators over traditional providers?
What I find is that the Executors and families don’t necessarily know the options that are available to them when somebody passes away. The general perception is they have to go down a traditional route – like the high-street solicitor – or someone who perhaps doesn’t just specialise in estate administration. What I would also say to someone is it’s about making an informed decision. The benefit of an estate administration provider like us is our fixed fee pricing. The fee is transparent from the point of signing the contract.
What we see is other providers often find it difficult to establish a transparent fee. A lot of the estate administration with traditional providers is done in stages and often at an hourly rate. The benefit of using an Estate Administration specialist provider is having the communication plan on an individual basis. Within Kings Court Trust, we make sure we tailor the journey to the individual’s needs. If a family requires email contact because they are busy, we will make sure we schedule this when it’s convenient. We work around people and their individual needs.
Kings Court Trust are one of the UK's leading providers of estate administration. For more information on Wills, estate administration or how Kings Court Trust can help, call our Client Services Team on 0300 303 9000 for free guidance and advice.