By Ian Robinson
DIY probateUnderstand the key steps you'll need to take if you decide to carry out the probate process yourself.
While many executors use solicitors to handle the entire probate process, around a third of probate applications are carried out by those who have opted for DIY probate.
The obvious reason is to save on cost. Using a probate solicitor can cost thousands of pounds, while DIY probate may not cost more than a few hundred.
However, while DIY probate can considerably reduce costs, it leaves you with a lot of paperwork. As the executor, you can't cut any corners and are legally responsible for meeting all legitimate claims (including tax). If you fail to act correctly, you could be sued by one or more of the beneficiaries.
If the deceased used a bank to draw up their will, and the bank was appointed a co-executor, some banks used to insist on acting as a professional executor and on carrying out probate too. As banks tend to charge a percentage, this can be expensive. You can ask the bank to renounce its executor role, if the beneficiaries agree. To find out more about charges, visit our page on probate solicitors.
Probate stages explained
Handling probate as an executor entails valuing the estate, applying for a grant of probate, and undertaking the administration of the estate - where assets are gathered in, then distributed to the beneficiaries. In Scotland, this process is called Confirmation.
You can undertake each stage yourself, rather than using a solicitor.
- In some cases, you can get a solicitor to help obtain the grant of probate, then take over the estate administration yourself.
- The suitability of DIY probate depends on the nature of the estate, the provisions of the will and the aptitude of the executor for taking on responsibility for the whole process.
11. Paying for the funeral
Before beginning the probate process, you may have to pay costs to cover funeral expenses. Most banks will agree to make a direct payment from the deceased's bank account to cover these expenses.
Remember to ask:
- Will the funeral director wait for payment until probate has been granted?
22. Assessing the estate
Track down the original will and check you are named as an executor. You will need to go through the deceased's papers and bank statements to establish their assets and liabilities. For some estates this is straightforward, but others are far more complex, with multiple investments, properties and personal effects to consider.
- You need to send a certified copy of the death certificate to each institution and ask them to submit a final statement. Banks will pay out funeral expenses before you obtain a Grant of Probate, but most assets remain frozen until this has been formally granted.
- If the estate includes a property, this needs to be valued. You can value the property yourself, but getting a professional valuation (in writing) from an estate agent or surveyor will make dealing with HMRC far more straightforward if it challenges your assessment.
Remember to ask:
- Have you accurately assessed the deceased's estate, including all their savings and investments?
- Has each bank given details of all accounts, including stock and share Isas?
- Are there items (such as property) that you need to get professionally valued?
33. Probate forms and fees
Once you have worked out the details of the estate, the next stage is to complete a probate application form (PA1). You can download this from the HM Courts & Tribunals Service website. In Scotland, you send confirmation forms C1 and C5 to the Sheriff Court.
- At the same time, you have to submit a form to HMRC to establish the IHT liability of the estate. Use form IHT 205 if it is below the IHT threshold (£325,000), or IHT 400 if it’s above. The same forms are used in Scotland.
- The threshold can be raised in cases where the deceased was the surviving spouse or civil partner of someone who has died earlier. Any IHT allowance that the first partner did not use can be claimed by the executor of the second, on a pro-rata basis. This can potentially mean that the threshold in such circumstances is £650,000 - twice the individual nil-rate band. To claim additional allowance, executors must complete form IHT 217 if the estate is below the IHT threshold, or form IHT 402 if the estate is above the threshold.
- As well as the value of the estate at the time of death, HMRC requires details of cash gifts made by the deceased in the seven years before death. These can increase the value of the estate for IHT and need to be checked carefully.
Once the forms are completed, they should be sent, together with the original will and death certificate, to the Probate Registry. As well as supplying the right paperwork, you need to swear an executor’s oath (confirming that the details you’ve provided are correct). You can do this at your nearest Probate Registry, or at a local solicitor’s office if this is more convenient.
The probate application fee is £215. Additional copies of the grant can be ordered for 50p each. It's worth getting multiple copies at this stage - most people need at least six.
Remember to ask:
- Can you apply for unused personal tax allowance from the deceased's widow or widower to be transferred, increasing the IHT threshold where tax becomes due?
44. Obtaining a Grant of Probate
Provided that everything is in order and that HMRC accepts your valuation, any IHT due on the estate must now be paid. This is a requirement of getting the grant of probate.
- If there is enough money in one of the deceased’s bank accounts to cover the amount due, it should be possible to arrange a direct payment to HMRC. Most UK banks permit this on receipt of an IHT 423 form.
- Where the estate assets are tied up in property or shares, HMRC will accept IHT payment in instalments, and only requires a tenth of the total due in advance.
When paying inheritance tax, remember to ask:
- Will the bank or financial institution make a direct payment?
- Is there enough in the deceased's main account to pay the IHT due?
- Can the IHT be paid in installments?
This is the last stage of probate. Administration involves gathering in all the assets you have identified, and distributing them as directed by the will. Once probate has been granted, most institutions will release funds without delay.
You need to send them a certified copy of the grant in order to arrange this. The money you receive should be paid into a special executor's account, separate from your own.
- Once you have received the funds due, you can make appropriate payments to each of the beneficiaries.
- The last task is to prepare a set of final accounts. You need to keep these and the supporting paperwork for at least 12 years (the limitation period for any claim against the estate).
Once you have received grant of probate you should also consider placing an ad in the The Gazette asking any unknown creditors to come forward. If you do not, then you could be held personally liable for unidentified debts.
When setting up the executor's account, remember to ask:
- Will the deceased's bank set me up with an executor's account?
- As an executor, will I get online access or just a cheque book?
- Does it make any difference if I use the same bank as the deceased?
- What proof of identity will the bank require for in-branch transactions?
When distributing assets to beneficiaries, remember to ask:
- Have you identified all beneficiaries?
- Have you paid all estate debts and taxes?
- Do the estate accounts include all money received and paid out?
- Last updated: December 2016
- Updated by: Tom Wilson