If you’ve recently lost a loved one or are the executor of a will, you will need to apply for probate. Probate can sometimes seem confusing so we are here to explain what probate involves and why it’s so important.
We know that losing a loved one is one of the hardest things you will ever have to go through, and applying for probate is a huge part of that. Before starting your application, you will need to understand what probate is, the key steps involved and the documents you may need to apply for.
What is Probate?
Probate is the legal process you need to go through to deal with your loved one’s estate when they pass away. This involves organising their money, assets and possessions and distributing them as inheritance, after paying and taxes and debts.
This is often called ‘applying for probate’. After submitting your application to the government, you will receive a document that you can take to banks, the Land Registry and other organisations. This document gives you the authority to collect assets and distribute funds to beneficiaries that may be named in your loved one’s Will. Assets in joint names usually pass to the surviving person.
What is a grant of probate?
A grant of probate is an official court document that proves you have the authority to deal with someone’s estate. When a person makes a Will, they need to appoint at least one Executor. This Executor has the power to administer your loved one’s estate such as selling property, pay off debts, close accounts and distribute assets in accordance with the Will.
Even though the power to administer the estate is derived from the Will and the appointment takes effect immediately on death, being a named Executor is sometimes not enough. Most financial institutions will not automatically allow the Executor of a Will access to financial accounts without having obtained a Grant of Probate first.
What is a grant of letters of administration?
A grant of letters of administration is an official court document that proves you have the authority to deal with someone’s estate. Letters of Administration are normally issued to the person(s) who are entitled to the estate under the rules of intestacy (or their guardians if they are minors) where your loved one has passed away without a Will.
The main difference between letters of administration and a grant of probate is that a grant of letters of administration is needed to deal with someone’s estate where there is no will. It may also be needed if there is a Will but the executors are unable to deal with the estate. This is called a grant of letters of administration with Will annexed.
What is a Will?
A Will is a must have document, dividing your assets in the way you would like, to the people you wish to benefit.
There are almost limitless reasons why someone should make a Will. Some draw up a Will to make provisions for partners (if not married/ civil partners) and some like to make provisions for former spouses/ partners. Other reasons for making a Will are that it allows you to choose the guardian for any children who may still be under 18 rather than allowing children to go through government systems before being reunited with family. Another reason why people choose to make a Will is the simple reason that it can be entirely more tax efficient.
Also, many families have extended family trees in respect of step-parents and children. Individuals making a Will sometimes feel that they do not want step-children to benefit from the estate and choose to exclude them. This must be concluded in writing before it can become legally binding.
Another crucial reason for a Will is that many older people wish to prepare for their financial legacy by creating Trusts, which enable their funds to be handled and dispersed in a tax efficient manner. In your Will you may appoint Trustees who will manage these trusts upon your passing to ensure they are not mishandled or destroyed.