Probate is used to dispute the property ownership of a person before they pass away, and outlines what steps to follow afterwards. Having a probate allows this to be a smooth and careful process. But how do these situations unfold if there is no agreement in place?

If you are appointed the executor or administrator of an estate following a person’s death the law does not dictate that you need to file for probate but this will cause problems, as without probate, the title of any assets that belonged to the deceased will not be legally transferred.

What is probate?

Probate is a process whereby the distribution of a dead person’s estate, whether they have a will or not, is overseen and given approval by a court. The person who is named as executor applies for a grant of probate so that  they can obtain the authority to distribute the deceased’s assets and possessions as inheritance.

Probate ends once all taxes, debts and inheritance has been passed on. Probate is needed whether or not the deceased person has left a will, although if the estate you’re dealing with is worth less than £10,000 or is only made up of joint assets (such as a mortgage or joint bank account), then you may not need probate.

How to obtain probate

Probate needs to be applied for as soon as possible as it can take weeks, maybe months (as a result of the covid crisis) for the application to be approved. You need to assess what the assets and debts are within the estate and then you can go forward with your application.

This is a process that you can actually tackle yourself, but most probate cases are a little more complex so it is simpler to pay a probate solicitor to do them for you.

Once you’ve received the grant of probate you can usually go ahead and sort out the estate yourself – including selling property, paying off debts, closing bank accounts and distributing assets. However, your solicitor can also take on all duties including collecting and transferring assets, paying off debts and contacting beneficiaries about their inheritance should that be required.

You can proceed without probate under certain circumstances

• Probate is not always necessary for small estates in England or Wales.
  This is because some assets up to a value of £5,000 can usually be transferred without going through the probate process. The probate threshold in England and Wales can actually be anywhere between £5,000 and £50,000. This is because every bank and financial organisation has their own rules on how much money they can release before seeing a grant of probate. To ascertain this you need to contact each asset holder, for example a bank or mortgage company, to find out if you’ll need probate to get access to their assets. So it is possible to proceed without probate if the deceased’s estate doesn’t include a property to sell and their bank will release money under £50,000.
  
• If the deceased owned property in joint tenancy with someone else, ie. a couple were both on the title deeds of a property then the owner would automatically inherit the property under the Right of Survivorship and probate is not needed for this.
  
• Putting your house in a trust for example can save your inheritors probate costs which can be up to 3% of your asset’s value.

However, in most situations probate is a necessary part of the process following someone’s death and if you went ahead without applying for a grant of probate then you could create numerous difficulties when it comes to distributing their estate.

For example, there could be disputes between beneficiaries if there is no probate in place and more frustrating is the fact that the estate will not be distributed at all. It will continue to exist but nobody will benefit.
This is because, without obtaining probate all property, finances and possessions are placed into limbo. Assets will exist but be frozen with nobody able to do anything about them. Ultimately, not obtaining probate causes a huge headache for loved ones and friends further down the line.

Problems which may arise if you proceed without probate include:

1. Tax

If inheritance tax is owed on the estate, a tax return and any tax which is due needs to be filed within six months of the death.

2. Banks

Banks have to be legally notified of someone’s death.

3. Executor

Filing for probate is your duty if you are an executor but not doing so, will mean anyone benefiting from the will may have you removed as an executor.

4. Selling a property

If probate hasn’t been issued you can’t sell any property owned by the deceased.

5. Capital Gains Tax

Delaying probate can create issues with capital gains tax as values are often assessed using probate documentation and  obtaining probate values retrospectively can be difficult.

6. Tenants in Common

When someone owns a property as tenants in common, the property does not automatically transfer to the owner who is left behind. In fact the deceased’s part of the property becomes included  in their estate and is inherited by whoever is the legal inheritor. And probate is absolutely essential to sort this out.

7. No beneficiary

If a person dies with assets such as a home, car, retirement pot etc but hasn’t named a beneficiary nobody will be able to inherit these without probate.

8. Problems with the will

There could be problems with the will, for example the deceased’s state of mind when making it might be called into question – and this is something that is dealt with during the probate process.

Decided to proceed with a probate application? At Wafer Phillips we understand that the period following someone’s death is a very difficult time but we are here to help. Our solicitors will be there to advise you every step of the way during the probate process. You can find all our contact details at our contact page.