Pragmatics of administration...

ferger

Jolly glad to have found this place, I can see there's a lot of useful knowledge in the regulars!

Some background: My father passed away just before Christmas. He was in the process of redrafting his will to acknowledge some small, specific bequests and to change the executor from his prior employer, a bank - who had offered probate services for free, but then started charging - to me - he had discussed this with me over a year ago, and I didn't realise that he hadn't effected the changes until he died. (I have spoken to the local solicitor he was using and seen a draft of his new will.) It took us a while to find his original will, tucked as it was between some books, but we have now located it - good, as it is the only valid will. In practice, I don't think it makes a lot of difference - my sister and I are the residual beneficiaries, my mother having passed several years ago.

In the circumstances, I have asked his employers to renounce executorship in our favour, which they were happy to do, and I will wind up the estate and apply for Letters of Administration with the will annexed, naming my sister as secondary administrator when it comes to it.

So... I have done all the practical things around his house's services and am in the process of collecting together details of bank, credit card, shareholdings, other investments etc. The estate is not hugely complex, but there are many strands of finance, and it will certainly attract IHT, given the value of his house, even acknowledging the transfer of Mum's allowance. I am confident I can manage the process, if a little daunted at the moment - I am a process-oriented kind of guy, with a background in finance years back, although now work in a different realm - which is why my Dad wanted me to do it, rather than my sister. I think this put her nose out joint a bit, but she is coming to see how much complexity there will be and is probably grateful, if a bit surprised at my view that we will unlikely see any of the estate proceeds for at least a year.

So, a couple of questions that I haven't really seen covered in the probate books I have worked through:

1) I've had a couple of people express an interest in some items that he owned and asked if they could have first refusal on them - TVs, microwaves etc. My original view was that I could see no reason why not as long as I accounted to the estate for the funds and charged appropriate market-value, holding them in administrator account etc, but I am feeling a bit twitchy about it. The same applies to his car - it would seem much more sensible to sell it on the open market than have it sitting around idle for 6 months, and probably get the best measure of its value. But... I have seen one piece of advice that says I could only do this if I was named as executor, and cannot do it in my situation - I must keep all his possessions intact until grant is received. Would really appreciate views on this!

2) In a similar vein... my sister is desperate to start clearing his house out, from a pragmatic 'it will help with closure' perspective. In fact, she was in the house yesterday (she and I have only keys, I changed the locks), tidying up stuff, and throwing out some 'no-value' items. I got drawn into a bit of a conversation around this, and ended up saying that I couldn't see any harm in it... but, again, I am feeling a bit twitchy about it. There is no reason really to do this apart from her need to be getting on with something, and I fear that it will make it very hard for me to demonstrate appropriate securing of the estate, were it to be challenged. Am I being anal about this - or should we really just leave the place secured, as is for the moment? (Notwithstanding certain valuables, which have been removed for safekeeping elsewhere).

I'm sure I'll have other questions as I work through this - and happy to become a bit of a case-study - but I'd love to hear some views on these early pragmatic questions!

jackyann

Someone will come along with legal knowledge, but having done this myself, I will share this with you:

It is perfectly normal for friends, neighbours & relatives to receive small items of little monetary value as keep sakes.

It is also normal to put down a notional value for household (including garden & workshop) items of low market value. You really don't have to itemise every kitchen gadget, spade, saw etc.

With this in mind, it would be reasonable to clear items of no significant value. It would also be reasonable IMHO to gift items of low value. We certainly gave away books, clothes, kitchen & garden items before getting formal administration.

We also (there wasn't really anyone to object!) gifted quite expensive items to certain people or charities ( in accordance with our father's wishes, though not in his will) just keeping a note of it all. I think you can set this against IHT.

Your sister is right that it helps the grieving process, and I think she may feel (as I did) that she can help by getting on with the practical work.

Can I suggest that you ring the Probate Office? They are very helpful, and will give you guidelines.

g6jns_2

ferger wrote: »

Jolly glad to have found this place, I can see there's a lot of useful knowledge in the regulars!

Some background: My father passed away just before Christmas. He was in the process of redrafting his will to acknowledge some small, specific bequests and to change the executor from his prior employer, a bank - who had offered probate services for free, but then started charging - to me - he had discussed this with me over a year ago, and I didn't realise that he hadn't effected the changes until he died. (I have spoken to the local solicitor he was using and seen a draft of his new will.) It took us a while to find his original will, tucked as it was between some books, but we have now located it - good, as it is the only valid will. In practice, I don't think it makes a lot of difference - my sister and I are the residual beneficiaries, my mother having passed several years ago.

In the circumstances, I have asked his employers to renounce executorship in our favour, which they were happy to do, and I will wind up the estate and apply for Letters of Administration with the will annexed, naming my sister as secondary administrator when it comes to it.

So... I have done all the practical things around his house's services and am in the process of collecting together details of bank, credit card, shareholdings, other investments etc. The estate is not hugely complex, but there are many strands of finance, and it will certainly attract IHT, given the value of his house, even acknowledging the transfer of Mum's allowance. I am confident I can manage the process, if a little daunted at the moment - I am a process-oriented kind of guy, with a background in finance years back, although now work in a different realm - which is why my Dad wanted me to do it, rather than my sister. I think this put her nose out joint a bit, but she is coming to see how much complexity there will be and is probably grateful, if a bit surprised at my view that we will unlikely see any of the estate proceeds for at least a year.

So, a couple of questions that I haven't really seen covered in the probate books I have worked through:

1) I've had a couple of people express an interest in some items that he owned and asked if they could have first refusal on them - TVs, microwaves etc. My original view was that I could see no reason why not as long as I accounted to the estate for the funds and charged appropriate market-value, holding them in administrator account etc, but I am feeling a bit twitchy about it. The same applies to his car - it would seem much more sensible to sell it on the open market than have it sitting around idle for 6 months, and probably get the best measure of its value. But... I have seen one piece of advice that says I could only do this if I was named as executor, and cannot do it in my situation - I must keep all his possessions intact until grant is received. Would really appreciate views on this!

2) In a similar vein... my sister is desperate to start clearing his house out, from a pragmatic 'it will help with closure' perspective. In fact, she was in the house yesterday (she and I have only keys, I changed the locks), tidying up stuff, and throwing out some 'no-value' items. I got drawn into a bit of a conversation around this, and ended up saying that I couldn't see any harm in it... but, again, I am feeling a bit twitchy about it. There is no reason really to do this apart from her need to be getting on with something, and I fear that it will make it very hard for me to demonstrate appropriate securing of the estate, were it to be challenged. Am I being anal about this - or should we really just leave the place secured, as is for the moment? (Notwithstanding certain valuables, which have been removed for safekeeping elsewhere).

I'm sure I'll have other questions as I work through this - and happy to become a bit of a case-study - but I'd love to hear some views on these early pragmatic questions!

Sorry for your loss. It is a difficult time but don't get bogged down in the trivia. Apart from the car I would do just as you have. The fact that you are not yet executor should not present a problem. 90% f the job is common sense. HMR&C realise you can't really account for every last penny. Just don't take the mickey! Depending on the value of the carrefernce to Parkers Guide should suffice. The only concern is not letting it stand unused for months. You need to insure it as your late father's insurance will probably have lapsed. Likewise the house insurance. Good luck.

ferger

That's useful advice chaps, thank-you. I'm very happy not to get involved in trivia - and if my sister is keen to do it, more's the better! I understand I only need to account individually for items worth more than £500 - of which there are very few - but I just don't really have a sense of what is pragmatically acceptable beyond that. Selling items for OMV / gifting items with no real OMV and accounting to the estate for it seems an entirely sensible approach, and I would really like to get rid of his car on that basis (it's probably worth £7-8k). But I have the Lawpack probate guide, amongst others, and it seems clear that I can't do this. Anyone able to confirm otherwise?

I may have read too much that emphasises the responsibility associated with what I am embarking on! I don't want this to go on any longer than it needs to, and am thus a bit concerned at making any decisions that might encourage further scrutiny (and delay) when it come to applying for the grant.

getmore4less

If the only beneficiaries are you two then the only organization you need to satisfy will be HMRC for the value of the estate.

DVLA won't care about the car a buyer might, dealers are usually ok if you can show them something if asked.

The rest of the stuff a good inventory backed up with photos will probably be sufficient and handy to remind you as well as you prepare the estate accounts.

The timings won't matter technically you need the grant in practice the only people that can take action are beneficiaries.

Once you have a clear picture and agreed with HMRC the plan for payment of IHT and the grant you could consider distribution of some of the liquid assets.

ferger

<<DVLA won't care about the car a buyer might, dealers are usually ok if you can show them something if asked.>>

I hadn't thought about that aspect of selling the car - what do people normally do with the V5C, just sign it as the deceased's personal representative?

Mojisola

I used a solicitor to help with Dad's estate and he said the resale value of most household items is negligible. He suggested £500 as the 'value' of the contents of a 4 bed house. Nothing was new and there were no antiques or valuable works of art - just the usual furniture.

Knowing what Mum and Dad would have liked, we managed to rehome almost all their possessions through family, friends, neighbours, Freegle and a range of charity shops.

BobQ

ferger wrote: »

<<DVLA won't care about the car a buyer might, dealers are usually ok if you can show them something if asked.>>

I hadn't thought about that aspect of selling the car - what do people normally do with the V5C, just sign it as the deceased's personal representative?

Yes, a dealer might ask to see Probate or a Will

Of course you could transfer it to your name and then sell it. The V5C is strictly only proof of registered keeper not ownership as such. I assume you have checked that it is not being bought on HP?

getmore4less

ferger wrote: »

<<DVLA won't care about the car a buyer might, dealers are usually ok if you can show them something if asked.>>

I hadn't thought about that aspect of selling the car - what do people normally do with the V5C, just sign it as the deceased's personal representative?

The dealer we used was happy with "son of deceased" for a commission sale.(they had sold the car).

There are some notes on the dvla web site.

TonyMMM

I don't think you should worry about any issues selling the car - the only possible "complainant" would be the other beneficiary. If she is consulted and happy with the price etc. then go ahead and account for the value as part of the estate.

You can sign the V5 as "for the estate of ......." if you wish.

ferger

Very useful comments, thanks all. I'm sure the car was bought outright - my Dad was fortunate enough to be one of that generation that did 40 years in a 1/60 final salary pension scheme. In the last couple of years he had very little mobility, and complained that he couldn't find anything to spend it on!