When someone close to you dies, the practical responsibilities that follow can feel overwhelming, and they arrive at exactly the moment you are least able to face them. Obtaining probate is only the beginning; the longer task is everything that comes after, and it is that task which estate administration solicitors carry out or support. Administration means gathering in every asset, settling every liability and tax charge, accounting for everything received and paid, and distributing the estate to those entitled. It is detailed work that carries legal responsibility for the person doing it, but it is also work you do not have to face alone. This article explains what administration involves, the duties that fall on executors and administrators, and the help available at every stage.
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What Does Administering An Estate Involve?
Estate administration involves a number of stages.
First, the estate is identified and valued. This includes every account, property, investment, pension, insurance policy, vehicle, and possession, together with every debt, from mortgages and loans to utility bills and care fees. Institutions are notified of the death and formal date of death valuations obtained.
Second, the inheritance tax position is established, any necessary account submitted to HM Revenue and Customs, and any tax paid.
Third, the grant of representation is obtained from the probate registry, giving legal authority to deal with the assets.
Fourth, the assets are collected in or sold. Accounts are closed, shareholdings are transferred or sold, and any property is sold or transferred to beneficiaries, with the legal work on a sale forming part of the administration.
Fifth, liabilities are paid, including debts, funeral and administration expenses, income tax to the date of death, and any tax arising during the administration period itself.
Finally, estate accounts are prepared showing everything received and paid, legacies are paid, and the residue is distributed to the beneficiaries.
What Responsibilities Fall On The Personal Representatives?
Executors and administrators, together called personal representatives, act in a position of trust. They must act in the interests of the estate and its beneficiaries, keep estate money separate, keep proper records, act impartially between beneficiaries, and avoid benefiting from the role beyond what the will allows. If you have been asked to take this role on, it reflects the confidence the person who died placed in you, and most people are keen to carry out the role effectively.
Administering an estate comes with personal liability for mistakes. A personal representative who distributes the estate and later faces a valid claim from an unknown creditor, an overlooked beneficiary or HM Revenue and Customs can be personally responsible for making good the shortfall, even where the mistake was entirely innocent. Reassuringly, though, the law provides well established protections, and making use of them is straightforward with the right guidance. For example, advertising for creditors under section 27 of the Trustee Act 1925, with a two-month notice period, protects against unknown debts. Waiting six months from the grant before distributing protects against later claims for financial provision from the estate. Searches, insurance, and, where genuine doubt exists, directions from the court deal with missing beneficiaries and uncertain entitlements. Part of an estate administration solicitor’s role is making sure the protections your particular estate needs are put in place, so that you can carry out the role with peace of mind.
How Long Does Administration Take?
Families often worry that the process will drag on indefinitely, and it helps to have realistic expectations from the start. A straightforward estate is commonly completed within nine to twelve months, and the law recognises what is known as the executor’s year, meaning beneficiaries cannot generally demand distribution before the first anniversary of the death.
Estates involving a property sale, inheritance tax, foreign assets, trusts, or business interests take longer, sometimes considerably so, through no fault of anyone involved. Where the administration will take time, interim distributions can often be made once the main liabilities are secure, which eases financial pressure on beneficiaries and reassures everyone that matters are progressing.
What Difficulties Can Arise, And How Are They Avoided?
Most estates are administered without incident, but it helps to know where difficulties tend to occur so they can be headed off early.
Assets or debts sometimes come to light late, property valuations can prompt enquiries from HM Revenue and Customs, benefits paid before death are occasionally reclaimed by the Department for Work and Pensions, and gifts made in the seven years before death can affect the tax position in ways families did not anticipate. Feelings can also run high between relatives during a period of grief, and clear information at each stage does a great deal to keep relationships intact. Where an estate’s debts exceed its assets, it must be administered in a strict statutory order of payment, and specialist guidance at the earliest opportunity protects the person handling it.
How Much Help Do You Need?
Support with administration is entirely flexible. Some clients instruct our estate administration solicitors to carry out the full administration from start to finish, so that the personal representatives sign what is needed and are kept informed while the work is done for them, which many find an enormous relief while they grieve. Others ask the firm to deal with a defined element only, most often the inheritance tax account and the grant application, and then complete the remaining steps themselves with the reassurance that the foundations are right. Where a solicitor is appointed executor under the will, the firm can act in that capacity throughout.
On costs, work is charged on the basis of time spent at published hourly rates, and fixed fees can be discussed, particularly for straightforward estates with a limited number of assets and beneficiaries. All reasonable administration costs are payable from the estate itself rather than from your own pocket.
Arranging An Appointment
Johnson Astills administers estates for families across Leicester, Loughborough, and the surrounding areas with care and understanding, from modest estates to those involving tax, trusts, and property. If you have been named as an executor, or a relative has died without a will and the task has fallen to you, call our new enquiries line on 0800 059 0600 to arrange an appointment at whichever of our offices suits you, whenever you feel ready. We will listen, establish what the estate requires, agree the level of help you would like, and take as much of the burden from you as you wish to hand over.
Please call us free now on 0800 059 0600 or complete a Free Online Enquiry and a member of the team will get back to you soon.
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