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Probate and Inheritance
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# 1
boswell99
Old 01-12-2008, 12:27 PM
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Default Probate and Inheritance

Hi,

My grandfather passed away last week and I was wondering whether anyone would be able to give me any advice as to how long probate and inheritance may take? A friend mentioned that it can take a year or more to come through which is rather worrying as my mother gave up her job three months ago to look after my grandfather and has no money coming in and no savings (I have been able to lend her a small amount but won't be able to support her for an entire year).

I'm not sure how complicated his estate is, a small lump sum has been left to me and the rest has been left to my mother. However, it has been left in a trust overseen by the executors (a solicitor and one of my mothers cousins) and we have no idea what form this trust takes or what it's for. He will have left a sizeable amount which will definitely fall into the 40% tax band as well as property worth probably around a million pounds. I have also heard that inheritance tax has to be paid before the estate is 'unfrozen' so am additionally worried about where this money is supposed to come from. He also may have some funds in Switzerland which may further complicate things.

Unfortunately my grandfather was a very secretive man when it came to money so we have little information, but any rough timeframes would be appreciated (less than a year, more than a year, three years etc).

Also, someone said that an 'emergency payment' may be able to be paid to my mother before it's all officially sorted - is this true?

Thank you.


Edited to say: I hope this is the right place for this, I wasn't sure where to put it.

Last edited by boswell99; 01-12-2008 at 12:30 PM.
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# 2
debtfreein4years
Old 01-12-2008, 12:53 PM
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it depends what type of estate your granddad has left, from what you have said it sounds fairly complicated with money possibly being in different countries.

i used to work in the probate department of a bank dealing with high net worth customers and probate could take anything from a couple of months to a couple of years depending on the nature of how the deceased had organised the accounts.

usually i would say the average time to get probate would take about 6 months and i would recommend the solicitor dealing with everything as its less hassel for all concered and then another 6 months to wind up the deceaseds accounts and distribute them to the beneficiaries.

with regards to the money in the estate and interim payment can be made, but only once probate has been granted and with the express permission of the executors - thats my understanding from dealing with my late granddads estate. however most banks will release money from the accounts to pay for funeral expenses, however the executor would need to speak to the bank in question to see if that is within their remit.

also with regards to the paying of inheritance tax, some banks will release money to pay for this, but you are usually required to sign an indemnity form and it depends on the individual policy of the bank.

hope that helps.
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# 3
RobertoMoir
Old 01-12-2008, 1:00 PM
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Quote:
Originally Posted by boswell99 View Post
Hi,

My grandfather passed away last week and I was wondering whether anyone would be able to give me any advice as to how long probate and inheritance may take? A friend mentioned that it can take a year or more to come through which is rather worrying as my mother gave up her job three months ago to look after my grandfather and has no money coming in and no savings (I have been able to lend her a small amount but won't be able to support her for an entire year).

I'm not sure how complicated his estate is, a small lump sum has been left to me and the rest has been left to my mother. However, it has been left in a trust overseen by the executors (a solicitor and one of my mothers cousins) and we have no idea what form this trust takes or what it's for. He will have left a sizeable amount which will definitely fall into the 40% tax band as well as property worth probably around a million pounds. I have also heard that inheritance tax has to be paid before the estate is 'unfrozen' so am additionally worried about where this money is supposed to come from. He also may have some funds in Switzerland which may further complicate things.

Unfortunately my grandfather was a very secretive man when it came to money so we have little information, but any rough timeframes would be appreciated (less than a year, more than a year, three years etc).

Also, someone said that an 'emergency payment' may be able to be paid to my mother before it's all officially sorted - is this true?

Thank you.


Edited to say: I hope this is the right place for this, I wasn't sure where to put it.
Firstly, sorry for your loss.

I've recently lost my mother and we're currently trying to get probate granted for her estate. Even though hers is a simple estate, not worth all that much, all information more or less to hand, it still looks like it's going to take 2 or 3 months at least for us to get moving, so you can be sure that a complex estate with lots going on and not a lot known about it is certainly likely to be slower than this.
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# 4
dzug1
Old 01-12-2008, 1:00 PM
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Looking at your information, it does look complicated. My guess is around a year. Given that he was secretive it might take a while to unearth information, even for a professional, so maybe longer. It will depend on how much paperwork he left.

Inheritance tax - National Savings and most banks will pay the IHT and funeral bills from the frozen accounts. At worst they will lend it to the executors. At least for the moment you don't need to worry about this.,
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# 5
sloughflint
Old 01-12-2008, 4:47 PM
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Quote:
Originally Posted by dzug1 View Post

Inheritance tax - National Savings and most banks will pay the IHT and funeral bills from the frozen accounts. At worst they will lend it to the executors. At least for the moment you don't need to worry about this.,
Apparently another option is to pay the inheritance tax in instalments and might be cheaper (3%) compared to a bank loan?

http://www.hmrc.gov.uk/cto/customerguide/page12-6.htm#1
Quote:
Can I pay by instalments?

In some cases you may pay inheritance tax by instalments. However, you may have to pay interest on any tax paid this way. More on interest on instalments.
You may pay inheritance tax by instalments on certain types of assets. These are
  • land and buildings
  • certain shares and securities
  • the net value of a business or an interest in a business, including a profession or vocation, carried on for gain (this does not include individual assets of a business, which are distinct from the business as a whole)
  • timber
The most common asset on which tax may be paid by instalments is the deceased’s house.

Last edited by sloughflint; 01-12-2008 at 4:52 PM.
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# 6
sloughflint
Old 01-12-2008, 5:52 PM
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Quote:
Originally Posted by boswell99 View Post

I'm not sure how complicated his estate is, a small lump sum has been left to me and the rest has been left to my mother. However, it has been left in a trust overseen by the executors (a solicitor and one of my mothers cousins) and we have no idea what form this trust takes or what it's for. He will have left a sizeable amount which will definitely fall into the 40% tax band as well as property worth probably around a million pounds. I have also heard that inheritance tax has to be paid before the estate is 'unfrozen' so am additionally worried about where this money is supposed to come from. He also may have some funds in Switzerland which may further complicate things.
I don't wish to alarm you but seeing that a solicitor is one of the executors and the restrictions this can create, it immediately reminded me of this thread:

Solicitor slow over probate

I hope your mother's cousin doesn't encounter similar difficulties but be aware of STEP in case.

Last edited by sloughflint; 01-12-2008 at 6:46 PM. Reason: insert word
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# 7
Mikeyorks
Old 01-12-2008, 7:46 PM
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Quote:
Originally Posted by boswell99 View Post
I have also heard that inheritance tax has to be paid before the estate is 'unfrozen' so am additionally worried about where this money is supposed to come from.
More accurately ..... IHT has to be 'paid' before Probate is granted. If the Estate is asset rich but cash poor ..... paying the IHT initially by instalment is the practical proposition (the balance is immediately due if/when the assets giving rise to the IHT charge are sold) ..... and sloughflint has helpfully posted you a link to that.

It's for the Executors to worry about the cashflow .. but if there's a Solicitor involved .... your Mother would sensibly be in the Executors ears on a regular basis. It's just another job for them and passing time (and repeatedly picking up the file) simply adds to the remuneration despite the basic charge probably being fixed on the Estate value. But if your grandfather appointed them ... too late to undo it now.

I recently got Probate for my Mother's estate in 6 weeks .... but had everything to hand. No IHT .. but there is a property to be sold and, as you will find, it is not a good time for that. No matter how realistic your price. So I would suggest you're looking at the best part of a year to complete. But if there's net cash .... then an interim distribution should be made rather than allowing funds to sit in a poorly paying Exor account.
If you want to test the depth of the water .........don't use both feet !
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# 8
boswell99
Old 01-12-2008, 9:44 PM
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Hi everyone,

Thanks for taking the time to reply, it helps to get a rough timeframe to plan around. And especially thanks for the links to paying inheritance tax by installment, I wasn't aware you could do that. If an interim payment could be made after 6 months that would be an OK situation, so lets hope that's the case. I've had a browse of the thread about the solicitor dragging his feet so will definitely make sure we stay on top of him.

Thanks again,

Ami
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# 9
elementalgrace
Old 03-12-2008, 2:41 PM
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I am sorry for your loss. We've been going through something similar with my Father's estate, which has taken 18 months to grant a certificate of probate. The insurance companies that held the life insurance policies would not pay out without a certificate of probate and even post certificate, things are still going on that may take up to another year to resolve due to the incompetencies of my late father's accountant.

I hope your situation resolves itself faster than ours has. I wish you the best of luck.
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# 10
ukmaggie45
Old 04-12-2008, 1:02 PM
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Quote:
Originally Posted by boswell99 View Post
I've had a browse of the thread about the solicitor dragging his feet so will definitely make sure we stay on top of him.
Hi Ami, I'm the unfortunate person with the slow solicitor...

First, sorry to hear of you and your Mum's loss.

It's well over a year now (July and Sep 2007) since my parents died and we still have to pay out some of the pecuniary benefits. Both my daughters have had half of their inheritance. I have had the named amount left in mother's will (I am residual beneficiary). My cousin and parents' 2 GPs have had small amounts, but my husband is still waiting for his inheritance.

We have no idea what money is in the pot (so to speak), but touch wood we have an interested buyer for the flat. I never thought it would take so long to sort - both parents left valid wills, and they had an accountant who did their tax returns, so it really should have been easy enough to get probate and sort the estate out.

Since my husband is one of the Executors, it would have been possible for him to do the work on Probate. But we were naive and thought it would be too difficult for us to manage. In fact I suspect we'd have got things done a lot faster. However, we would never then have realised that by doing a Deed of Variation there was the possibility to save around 120,000 on IHT. Shame the solicitor who is co-executor didn't spot that (even when asked a direct question!) so we now have another solicitor finishing off.

We're still waiting on the Revenue to find out if they have accepted our Deed of Variation.

Good luck with it all!

Best wishes

Last edited by ukmaggie45; 04-12-2008 at 1:04 PM. Reason: clarification
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# 11
TeresaO
Old 04-12-2008, 1:56 PM
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Hi,

My mums estate is quite straight forward and we achieved probate within 2 months. However, due to advertising in the Gazette we have to wait 2 months and 1 day to give creditors an opportunity to lay a claim on the estate - we didn't know all my mothers finances. We also have a house to sell, in this climate, great. So I anticipate that we could take up to a year before we can distribute this relatively simple estate.

I wish you well.

T
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# 12
bike234
Old 14-05-2009, 10:16 AM
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Default Probate

My situation is that my solicitor has sent the receipt from the Revenue to the Probate Registry confirming the IHT has been paid. Can anyone tell me how long the wait is before Probate is granted.

Last edited by bike234; 14-05-2009 at 10:19 AM. Reason: grammar
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# 13
Pee
Old 14-05-2009, 10:18 AM
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Probably about 7 days. It depends on how busy the Probate Registry are. I think several have been closed, amalgamated recently and so it might be a few days longer.
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# 14
bike234
Old 14-05-2009, 10:29 AM
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Default Probate

Thanks Pee
So if my solicitor said she sent it on the 5th of May, should be any day now. Thanks so much.
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# 15
John_Pierpoint
Old 15-05-2009, 3:18 AM
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Quote:
Originally Posted by sloughflint View Post
Apparently another option is to pay the inheritance tax in instalments and might be cheaper (3%) compared to a bank loan?

http://www.hmrc.gov.uk/cto/customerguide/page12-6.htm#1
This "recession" is not all bad news, the interest rate appears to have gone down to zero.
But there is now no incentive for anyone to get their skates on in the first 12 months, before penalties are imposed..

Interest is (normally) payable after the first 6 calendar months.

http://www.hmrc.gov.uk/rates/iht-interest-rates.htm

My timetable on an estate that has unfortunately nudged its way into IHT goes like this:
Death in September.
Records in disarray as deceased died of an undiagnosed brain disease which caused him "to lose the plot".
You have to be able to fix outstanding Income Tax problems before taking a stab at IHT.
Most financial institutions have a "bereavement" section that is geared up to supply the figures needed for probate and IHT.
You have to pay IHT on "accrued interest" ie money that is yet to pay income tax and that has not been paid out yet.
However some financial institutions are unable to get their act together. One infamous example, which I will name once the nightmare they are creating is over, were still writing to the deceased in his own name at his empty house, six months after being informed of his death and having returned the death certificate.

The time table is working like this:
Mid March, completed the IHT family of self assesment tax return forms, all 63 sides of A4 and applied, on-line, for a tax payer's reference number.
30 March reference arrives (2nd class post = 4 days in transit).
31 March locked in Bank of England while paying the tax. (Police kettle practice?)
31 March have to mail probate application as "court" knocks off at 16:00
20 April someone sends a manual note from probate department telling me to submit obsolete forms D18 & IHT200 (Actually IHT421 & IHT400 family) to HMR&C.
01 May attend for interview.
14 May still waiting. unable to get on with anything except cutting the grass.

If there is tax to pay, the process becomes about 4 times as complex and delay prone.

If you get an expensive solicitor (2,000 plus VAT to get started?) you will save some of the delay as he may have on-line submission of tax forms, the ability to administer oaths and hopefully a razor sharp mind when it comes to knowing all the tax wrinkles, (or does he hand the file to a trainee clerk?). However he will not be able to find the share certificates hidden behind the gas meter nor will he sort through the "heirlooms" (junk) stored in the house. If you don't do it, he will hire someone else to do it for you and the post funeral charges are not tax allowable..

DIY feels a bit like the difference between using the NHS or going private.
Does the latter produce better medical outcomes ?

By the way I'm not talking about sorting out Lord Lucan's estate, just that of a retired night shift worker who was lucky enough to live in a two bed Victortian house inside the M25.

Tax haven Switzerland? Any bets on it taking at least 12 months to be finalised?

John.

The one bright note I've noticed is that in 2002 the probate fee was 130 GBP, now it is 90 GBP.( for estates more than 5,000).

Last edited by John_Pierpoint; 15-05-2009 at 3:37 AM.
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# 16
John_Pierpoint
Old 15-05-2009, 3:50 AM
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Quote:
Originally Posted by elementalgrace View Post
I am sorry for your loss. We've been going through something similar with my Father's estate, which has taken 18 months to grant a certificate of probate. The insurance companies that held the life insurance policies would not pay out without a certificate of probate and even post certificate, things are still going on that may take up to another year to resolve due to the incompetencies of my late father's accountant.

I hope your situation resolves itself faster than ours has. I wish you the best of luck.
Would that have been a clever life insurance policy written in trust that fell outside the estate?

Prudential sent me a cheque within a month - it is still sitting in my executor account waiting for grant of probate.:rolleyes:
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# 17
relaxtwotribes
Old 16-05-2009, 2:14 PM
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Originally Posted by John_Pierpoint View Post
Would that have been a clever life insurance policy written in trust that fell outside the estate?

Prudential sent me a cheque within a month - it is still sitting in my executor account waiting for grant of probate.:rolleyes:
If the proceeds of the life policy fall outside the estate, why is there any need to wait until probate? The life company simply pays the proceeds straight to the beneficiary(ies) doesn't it?
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# 18
luke12341
Old 21-07-2009, 8:27 PM
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hi, im looking for some advice my grandparents left a large sum of money in probate in 1964, my mother and her siblings never knew anything about this untill i pulled up a probate record online, since the solicitor that delt with it at the time has stopped trading and is probably deceased himself i dont know where to start, to try and find out what happened to it, any advice would be great
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# 19
John_Pierpoint
Old 01-08-2009, 1:00 PM
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Originally Posted by Pee View Post
Probably about 7 days. It depends on how busy the Probate Registry are. I think several have been closed, amalgamated recently and so it might be a few days longer.
Was there IHT tax to pay?
In my case it took the tax system 10 weeks, during which time I got no acknowledgement and thought the forms had gone missing! A "pandemic" really could put a spanner in the works,


Quote:
Originally Posted by relaxtwotribes View Post
If the proceeds of the life policy fall outside the estate, why is there any need to wait until probate? The life company simply pays the proceeds straight to the beneficiary(ies) doesn't it?
The cheque was made out to the the executor and came from 3 door to door policies, the first of which was dated 1918 - Spanish Flu special?
My "probate" account at the Yorkshire Building Society was happy to take it but not keen to pay out until I had gained probate.
[With 11 beneficiaries, one of whom is HMRC, I have a situation that is too complicated to keep in my brain and so have to keep the "books" spot on accurate.]

Quote:
Originally Posted by luke12341 View Post
hi, im looking for some advice my grandparents left a large sum of money in probate in 1964, my mother and her siblings never knew anything about this untill i pulled up a probate record online, since the solicitor that delt with it at the time has stopped trading and is probably deceased himself i dont know where to start, to try and find out what happened to it, any advice would be great
You might get the tax man to help out?
The Nottingham office used to be really helpful and personal but this time I have been hived off to Belfast.
Last time, when my mother popped her clogs, I had to prove that father had paid death duties (there was still a legal charge on the family home preventing its sale before the tax had been paid; which the no longer trading firm of solicitors had not got removed back in 1967). I got a solicitor to drop the tax man a line as he seemed reluctant to dig out the old records on my say so.

Have you got the will from the probate office for the 1960's death. The situation sounds like mine and you might still benefit from the old tax legislation.
If you can disguise the personal details in the will, and publish it here, you might get good advice here.

Last edited by John_Pierpoint; 01-08-2009 at 2:39 PM.
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# 20
EdInvestor
Old 01-08-2009, 1:10 PM
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IIRC the life policy ,must be written in trust to be outside the estate, which sounds very unlikely with a policy started in 1918.
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