The term Probate (‘Confirmation' in Scotland) is the issuing of a legal document authorising one or more people to:
- collect together the money, property and possessions of a deceased person
- to pay taxes and other debts
- to distribute the remainder of the estate according to the will. If there is no will the estate is distributed according to the rules of intestacy.
The document is called a Grant of Representation in England and Wales, and Confirmation of the Estate in Scotland. It is issued by the Probate Registry in England and Wales, and by the Sheriff Clerk in Scotland. There are three types:
- Grant of Probate - issued to one or more of the executors named in the deceased's will
- Grant of Letters of Administration - issued to an appointed ‘administrator’ when the deceased has not made a will, or the will is not valid
- Grant of Letters of Administration (with will) - issued to an appointed ‘administrator’ when there is a will but with no executor named, or when the executors are unable or unwilling to act.
Probate/Confirmation may not be necessary if the deceased, after paying the funeral account, has financial assets of less than £5,000, no property and no stocks or shares and does not have an insurance policy. However banks and building societies may impose their own discretionary limit for requiring a Grant or Confirmation. Also, although it is not essential to obtain a Grant where the deceased left high value possessions but little cash it is better to obtain one in order to avoid accusations of improper distribution of the estate. To minimise the possibility of fraud, probate should start as soon as possible.
The main responsibilities of an executor or administrator are to:
- record all assets and liabilities at the date of death and any income received in the last year. A copy of the death certificate and will (if there is one) must be sent to each relevant organisation to find out whether the deceased’s funds can be released without a Grant of Representation/Confirmation
- determine if there is sufficient money to meet legacies in the will
- complete form IHT 400 if the estate is subject to inheritance tax (IHT)
- arrange funds or a loan to pay probate fees and IHT
- complete and return all forms to the Probate Registry (Sheriff Clerk in Scotland).
- pay the first instalment of IHT
- receive the Grant of Representation/Confirmation
- place the statutory advertisement for creditors and other claimants (England and Wales); obtain a Bond of Caution in Scotland (see below)
- present the Grant of Representation/Confirmation to the appropriate authorities
- collect all the assets due to the estate (‘in-gather' the estate in Scotland)
- agree the value of properties and pay any extra tax
- complete the income tax forms and capital gains tax forms
- release sufficient cash to pay all debts
- complete transfer forms for any stocks and shares
- deal with any claim under the Inheritance (Provision for Family and Dependants) Act 1975 (England and Wales only)
- prepare the estate accounts
- administer any trusts or life interests
- obtain approval of the estate accounts and distribute the assets to the beneficiaries of the will
Most applications for probate are made through a solicitor, notary or barrister. Charges vary, depending on the complexity of the case. Fees are charged to the estate, and may be a percentage (perhaps around 2%), or charged for specific tasks, or be an hourly rate. You should discuss the work to be done and charges before making formal agreement with the professional concerned. Check before using companies recommended by funeral directors and others as they may charge more. Some estates are processed in six months or so, but it can take a year or more if the estate is complex and if there is property to be sold.
Applying for Probate in England and Wales
Information, guidance and the necessary forms are available from the government website or from the Probate Registry, Probate and Inheritance Tax Helpline (telephone: 0845 3020900). The fee payable to the Probate Service is £45, but where the value of the estate is £5,000 or less, no charge is made by the Probate Service.The applicant must complete forms for HM Courts & Tribunals Service (HMCTS) and HM Revenue & Customs (HMRC) and send them to the Probate Registry together with the original will (if there is one) and two copies, an official copy of the death certificate, and the fee. Once the Probate Registry is satisfied that the application is valid, a Grant of Representation is issued.
Around 30% of applications for probate are made by an executor without legal assistance. Applying for probate yourself is said by HMCTS to be “fairly straightforward” in most cases. If you make a personal application for a Grant of Probate you will be required to swear an oath to confirm the information you have given in the application form is true to your best knowledge and belief, and to promise to deal with the estate as the law requires. You can choose to swear it either by attending a ‘probate venue’ (see below) at no additional charge, or at the office of any commissioner for oaths (usually a solicitor) for a small fee. The link How to obtain Probate - A guide for the applicant acting without a solicitor will help you decide whether you need probate and explains how to fill in the forms. Staff at your local Probate Registry can also help you, but are unable to give legal advice.
If there is no will, the Court can appoint a paid administrator to perform the duties of executor according to the rules of intestacy. Alternatively a family member may be willing to act as administrator at no charge.
The probate service consists of the Probate Registry in London, 11 District Probate Registries, 18 Sub-Registries and a number of Probate ‘offices’ in courts and local authority buildings. These venues are available for personal applicants to attend to swear oaths.
Applying for Confirmation in Scotland
If the deceased left a will, one named executor should attend the Sheriff Court so that all those named, subject to their being willing and able to accept office, can be confirmed and begin the process of administering the estate.
If there is no will, or the nominated executor is predeceased or unable to accept office, application must be made to the Sheriff Court for the appointment of an ‘executor-dative’ (chosen, in order, from the next of kin, anyone entitled to inherit, a creditor, or the procurator fiscal). If this is the surviving spouse, civil partner or next of kin it is not necessary to petition the court: the person applying should attend the Sheriff Court for an interview with proof of their identity and full details of the deceased’s estate. A bond of caution (see below) is still required.
If there is no will, the executor-dative must obtain a “Bond of Caution” from an insurance company as a guarantee that the executor will distribute the estate in accordance with the rules of intestacy. It must be lodged by the Sheriff Court along with the inventory form C1. However if the surviving spouse's prior rights under the rules of succession in Scotland (section 6.10) exhaust the estate, then there is no need to obtain caution.
To apply for confirmation two of the following forms must be completed. They can be downloaded from the HMRC website (simply search C1 and C5) or obtained from the local Sheriff Clerk’s office.
Forms you will need to complete
Form C1 is the application for confirmation in Scotland. It is an inventory of each item of the deceased’s estate and its value, together with a summary of the debts and expenses. The estate comprises: heritable property (land or buildings) and. moveable estate (money, investments and possessions). If the heritable property is owned solely or jointly the executor must obtain confirmation to be able to transfer the title to a beneficiary. If there is a survivorship clause the title of the property automatically passes to the surviving owner. If the estate is taxable, form C1 must be stamped by HMRC to show that all tax has been paid before application for confirmation is made. Form C1 (and C5) need to be signed by one executor and submitted to the Sheriff Court in the locality where the deceased lived.
Form C5 is used where the value of the estate (after deductions, charity exemptions, or because all assets were jointly owned and pass automatically to the surviving spouse or civil partner) is less than the inheritance tax threshold (£325,000) and the gross value of the estate does not exceed £1million. If inheritance tax is payable, Form C1 and Form IHT400 should both be submitted to HM Revenue & Customs.
Form IHT400 when inheritance tax is payable on the estate.
Estates valued at less than £36,000
In Scotland, if the total amount of the deceased’s gross estate is £30,000 or less, this is known as a small estate. The Sheriff Clerk’s staff will assist with the completion of forms C1 and C5. There is a court fee (£105 in 2012) for the provision of confirmation to the estate, but this is waived if the ‘net estate’ after payment of funeral expenses and debts is £5,000 or less. There is no additional fee charged for the Sheriff Clerk’s staffs’ assistance.
Estates valued at over £36,000 but less than £325,000
A formal Grant of Confirmation is necessary.The completed forms C1 and C5 should be taken or sent to the Sheriff Court with the will (where there is one) or a completed Bond of Caution (on intestacy) plus a cheque for the court fee. Distribution of the estate cannot take place until at least six months after the date of death – to allow anyone with a potential claim to be identified.
Estates valued at over £325,000
Form C1 and a form IHT400 need to be completed unless a form C5 can be used (see above) and sent, together with any tax the required to HMRC Inheritance Tax. HMRC will return the receipted form C1, which should then be sent to the Sheriff Court together with the will (if there is one), or a bond of caution (on intestacy), together with the required fee.
Liability to IHT must then be calculated and forms C1 and IHT400 sent, with payment, to HMRC Inheritance Tax in Edinburgh. Further assessment will be made, and a demand for more tax, or a refund, will follow at a later date.