Do I need probate:
Do I need probate for small holdings with insurance companies, banks etc? A grant may not be needed where:
- the person who died left less than £5,000.
- They owned everything jointly with someone else and everything passes to the surviving joint owner.
- The value of the estate is well below the Inheritance Tax limit and the banks etc which hold funds are willing to release them without insisting on seeing a grant of probate. Sometimes they will release assets on production of the Last Will, a death certificate and proof of your identity as next of kin or beneficiary. But they are under no obligation to do so, no matter how small the amount they help for the deceased.
Reducing the need for probate.
There are things which can be done in advance to cut out the need for probate. Or at least reduce the amount of work needed. We do offer a full estate planning service which can help in all sorts of ways for those able to plan – after death it is more about helping those left behind through measures such as Deeds of Variation,
However, there is one thing which can make things easier for most, and may remove the need for probate in very small estates. Where there was not a prepaid funeral plan in place, it may be possible to persuade the deceased persons bank or building society to release funds to pay for the funeral director direct. We’ve bolded “direct” as they will NOT reimburse anyone who has already paid the undertakers bill.
In some cases, this might reduce the value of the estate or the account below the level where probate is needed.
Do I need Probate?
To find out whether the assets can be obtained without a grant, the executor or administrator would need to write to each institution informing them of the death. They should enclose a copy of the death certificate (and Will if there is one). Each will have different requirements before they will release funds.
The general rule of thumb is that probate tends to be required when a bank account holds more than £5,000. Some firms however have much higher limits. However, banks and others set their own rules as to what they will release without a grant of probate and what proof of entitlement they require.
As soon as one class of asset requires probate, all assets have to be included, even if they are released prior to probate being granted. Please don’t get that wrong if you DIY!
Such as a house, flat, bungalow. Static caravans are normally considered as “chattels” and they are treated as general household goods. Property owned in the sole name of the deceased or under tenancy in common will require probate. Property owned as joint tenants will not necessarily require a grant of probate or letters of administration. The beneficial joint owner will normally automatically become full owner once the Land Registry has seen the death certificate.
Do I need Probate for Savings Accounts?
Many institutions will require a personal visit by the estate administrator, by appointment, for an in depth interview lasting around 45 minutes. Proof of identity will be required, along with the Will and other documentation. Do not just turn up expecting to sort things out on the spot, ring first and find out specifically what their requirements are. After the interview, most institutions will then pass everything on to their central Bereavement Department who may well have added requirements.
Clearly, there is scope for reducing the need for probate by cutting the number of savings accounts. Bear in mind that it only takes one to require probate, and you have to go through the whole process for everything, not just the one requiring the grant. There are two dangers in combining accounts:
- The larger accounts may require probate when smaller ones might not.
- Consumer protection may be reduced where significant sums are help within one institution or group of institutions considered to be one for purposes of the Financial Services Compensation Scheme which (at the time of writing) covers deposits of up to £85.000 within one group of companies.
National Savings may release funds where they hold up to £5,000 without a grant of probate.* However, they are not keen on releasing funds to funeral directors, but may consider it on an individual basis.
Banks and building societies are also usually willing to release up to £5,000.* The Nationwide seem to have much higher limits. As professionals, these sort of issues are less of a problem as we can present the same paperwork to each institution by post.
Stocks and Shares and ISAs will pretty much always require probate as a grant of probate is usually needed where investments are held.
*Subject to satisfactory proof of entitlement.