The Covid 19 pandemic has caused numerous changes in all walks of life, including the legal sector. Covid has impacted the way we work, with a mass introduction of working from home and agile working schemes, the way we socialise and interact with our peers, and the way we view illness.
The process known as probate is no exception to these changes. This article outlines how probates are administered in the current pandemic and how long the process takes.
Topics to be answered in this article
What is probate?
When someone dies, you may be in charge of sorting out their property, money, and any other possessions in a process known as ‘probate’. Probate is the legal right to deal with someone’s assets when they die.
What is the process for getting probate granted?
Every estate and every Will is different. The exact probate process can vary depending on the instructions left in the Will and the assets, creditors, and beneficiaries the estate has.
The basic process for getting probate granted is:
1. Check if there is a Will
This normally states who should deal with the Estate – known as the Executor(s). If there is no Will then the intestacy rules will come into effect and will dictate who is the correct person to deal with the estate – known as the Personal Representative(s).
2. Obtain details of the deceased assets and liabilities
All information relating to the estate will need to be obtained in advance in order to complete the Inheritance Tax return and the probate application. A lot of information will need to come from third parties, which can cause delays.
3. Complete an inheritance tax return and pay any tax due
Depending on the complexity of the estate, an inheritance tax return may be required to be completed and sent to HMRC. If Inheritance Tax is due, this will need to be paid before an application can be made for the Grant of Probate. For deaths occurring after the 1st January 2022, there is no longer a requirement to complete an IHT205 for accepted estates in the UK.
4. Apply for Grant of Probate
HMCTS has introduced the new online system which allows probate practitioners and individuals to make an application online. The new online system was introduced to simplify and speed up the application process. Unfortunately, due to some teething issues and COVID-19, we have experienced severe delays in Grants being issued. Additionally, not all applications can be made online. For more complex applications, a paper application is still required.
5. Receive a Grant of Probate
The Grant of Probate is the legal proof that the persons named on the Grant are the correct people to deal with the administration of this estate. This is the document needed to collect the Estate assets.
6. Collect the estate’s assets
Once you have received the Grant of Probate, this will need to be taken (or posted) to the bank, investment company etc. It usually takes 2-3 weeks for the funds to be received into the executors account.
An example of the estate’s assets would be money from the sale of the person’s property.
7. Repay any of the deceased’s outstanding debts
This includes unpaid utility bills and unpaid personal taxes. Before being in a position to finally wind up the estate, it is important to ensure you settle any outstanding debts. It is essential to make sure that there are no possible claims, debts, or other liabilities as the Executor(s) of the estate are liable for these. Statutory advertisements can be inserted in a local newspaper and the London Gazette which will offer protection to the Executor(s).
8. Settle tax position
It will be necessary to ensure income tax affairs for the period up until the date of death are settled. It is also the responsibility of the Executors to report any income received during the course of the administration of the estate and if applicable, pay the relevant tax on the income received. You may have to pay Capital Gains Tax on shares, investments or property if they’ve gone up in value since the person died or if they’ve gone up in value since being valued for Inheritance Tax.
9. Distribute the Estate
This includes distributing the property, money, and possessions, according to the instructions left in the Will. If you are passing on a property you must update the property register with HM Land Registry.
How long does probate take during the current pandemic?
The probate process can take anywhere from 6 – 12 months – sometimes even longer in more complex cases.
Typically, obtaining the estate information from third parties takes 6-12 weeks
From submitting the application to obtaining the grant of probate takes a further 6-12 weeks.
Collecting assets then follows, which can take between 6-12 weeks – this can be a lot longer if there is a property to sell.
Once this has been done, the assets can be distributed, which normally takes 6-12 weeks to include preparing final accounts.
What can cause a delay in probate?
You can either apply for probate yourself (DIY), or use a solicitor. Due to the complicated and somewhat confusing process that probate presents, even fairly simple estates can be a challenge to administer without the right help. At Goughs, we can support you with every aspect of Probate, simply get in touch.
The most common factors that cause delays during the probate process are:
1. Locating the Will
The original Will made by the deceased will need to be sent to the probate registry in order for a grant to be issued. If the original cannot be located, searches will need to be carried out to best locate the document. In the event the original is lost there is a possibility that court will prove a copy Will but this will cause significant delays. If the original or a copy cannot be located, the intestacy rules will come into effect.
2. Executors named in the Will have died or do not want to act
If the Executors name in the Will cannot act for one reason or another, then the position will pass to the next person entitled under the laws of ‘clearing off’. There is a complex set of rules as to who is next entitled to make an application. In order to work out who is entitled can cause delays. Additionally, a different type of application is required to be completed which is more complex and time consuming.
3. Third party delays
One of the most common issues that delay obtaining probate and administering an estate is relying on third parties. There are aspects of estate administration that are not within the executor’s control and third parties will need to provide information to allow the executors to complete the application or obtain the estate assets. It may take some time for companies to process requests regarding an estate of a deceased person because they have a set procedure they must follow.
4. Inheritance Tax liability
If Inheritance Tax is due on the deceased estate when this will mean that the probate process will take significantly longer. This is due to professional valuation being required. Additionally, the inheritance tax due will need to be paid before a grant can be issued. Sometimes sourcing funds for this can be problematic and cause additional delays.
5. DIY applications
Usually, DIY probate applications take longer than those made by professionals. This can be attributed to the lack of experience and knowledge that DIY applicants have when it comes to probate. The probate process is a significantly time consuming task to undertake. Many DIY applicants will not have the same amount of time as a professional to dedicate to the process. This will lead to it taking longer to achieve the same result.
6. Stopped applications
When an application is made, the probate registry will need to carry out detailed checks to ensure all of the information is correct. If any information given is wrong or queried the application will be stopped. Compared to applications that are approved on the first attempt, stopped applications can take more than double the amount of time to be issued. The most common causes of stopped applications are: supporting documents are missing, applications have been submitted too soon after sending information to HMRC, executors of an estate are missing or there is a query about the condition of the will.
Can I sell a house without probate being granted?
If there is a property in the deceased Estate, it is likely that this will be sold during the administration of the estate, although the property can be put on the market and a buyer can be found. The property sale cannot be completed without the grant of probate being issued.
It is important to be transparent with potential buyer(s), and to inform them that the property is a probate property. This will minimise the risk of a sale falling through if delays do occur. Unfortunately, if there are delays in obtaining a grant, sales can often fall through. This means that the process needs to be started from the beginning, which could take further time to find a new buyer and will likely incur additional costs.
How can Goughs help?
At Goughs, our experienced legal team is here to offer a helping hand, whether you need initial advice, assistance with a difficult stage or for someone to take responsibility for the whole probate process.