When someone close to you dies, it is easy to get overwhelmed by all of the tasks to be considered and the unfamiliar language associated with them. So, this article aims to answer some of the most common questions associated with handling an individual’s estate after they have died including ‘what is probate? ‘and ‘what is estate administration’. They’re both related to dealing with the deceased’s estate, but they have different definitions and people often get the two confused.
What is probate?
Probate may be required when someone passes away. It refers to the ‘grant of probate’, officially known as the ‘grant of representation’ in England and Wales and ‘confirmation’ in Scotland. Probate is required by law, and is often needed if the estate is worth more than £5,000 in value. Probate will be required if the deceased owned any property or if a financial institution (e.g. a bank or building society) needs to see the ‘grant of representation’ in order to release the funds. Probate will not be needed if the assets were held jointly as they will automatically pass to the surviving spouse or civil partner.
Applying for probate involves:
- Completing the application via a PA1 form in England or a C1 form in Scotland.
- Submitting the application by sending all of the details, including the death certificate, to the probate registry.
- Once the probate registry has received the application, you’ll be required to swear an oath which is a promise that the information you have given is true to the best of your knowledge. You’ll need to do this in person at a local probate office or at the office of a commissioner for oaths.
Probate is often mistaken for all of the tasks to be completed following a bereavement, but it actually just refers to obtaining the grant to enable you to carry out these tasks.
What is estate administration?
To put it simply, estate administration is the process of handling a person’s legal and tax affairs after they’ve died. This means dealing with all of their assets (e.g. property, personal possessions, shares and bank accounts), paying any Inheritance Tax and Income Tax and distributing inheritance to the estate’s beneficiaries. Estate administration can often be extremely complex, time-consuming and an added stress at an already difficult time for the Executor or Administrator.
Obtaining the grant of probate is usually a part of estate administration but it is so much more and could involve:
- Applying for probate
- Completing all Inheritance Tax forms
- Income Tax for the year of death
- Postal redirection
- Registering unregistered properties
- Valuing assets
- Property valuation and sale
- Cancelling or transferring utilities
- Arranging for a pet to be re-homed
- Distributing funds to beneficiaries
- And much more
The Executor or Administrator does not have to take full responsibility, they can choose to appoint a professional to handle the estate on their behalf.
So, what is the difference between probate and estate administration?
To conveniently sum up the difference between probate and estate administration; probate is just one part of the wider estate administration process. Probate provides you with the legal right to carry out the estate administration, including dealing with property, money and personal possessions.
If you have any questions about applying for probate or the estate administration process, call us on 01529 306005.