Probate Newbie

williamIV

Hi my partner recently passed away. We were unmarried but we had a mirror will leaving each to be the executor of the wills. 

We joint owned out home and we only had the one joint bank account. I spoke to the bank and they don't need probate ,I think everything will come across to myself and money in the bank is almost non existent.

This makes me think that DIY probate is possible because I may not even need it, no one has asked for it so far.

In the will I am named executor of the estate so I think I can apply for Probate if needed.

Do I need it?

I am a bit unsure about how IHT is calculated. We own the house together so am I effectively inheriting half the value of the property? We owe money on the mortgage , again do I half the amount outstanding ( as partner was joint name on mortgage), and we had a life insurance policy which pays the mortgage off, does this form part of the inheritance? And if so half or full amount?

Sorry if these are dumb questions,

Keep_pedalling

Your partner’s estate will only be subject to IHT if it exceeds £325k. For IHT purposes her share of the house would be 50% of the value less 50% of the outstanding mortgage. This assumes you owned the house on Joint tenants or tenants in coming with an equal share.

if you held the property as joint tenants then you are now the sole owner of the property automatically. If tenants in common you inherit her share through the will, in either case I don’t believe probate is required to make the changes on the land registry, unless you also need to make an IHT return because of the size of her estate.

msb1234

Was the insurance policy linked to the mortgage, in that it pays it off directly, or was it just a policy you took out that could be used to pay it off? I’d speak to the insurers to ask if they require probate.

williamIV

Keep_pedalling said:

Your partner’s estate will only be subject to IHT if it exceeds £325k. For IHT purposes her share of the house would be 50% of the value less 50% of the outstanding mortgage. This assumes you owned the house on Joint tenants or tenants in coming with an equal share.

if you held the property as joint tenants then you are now the sole owner of the property automatically. If tenants in common you inherit her share through the will, in either case I don’t believe probate is required to make the changes on the land registry, unless you also need to make an IHT return because of the size of her estate.

Thanks. 

A quick calculation of the house value and outstanding mortgage based on 50% ( value of house and mortgage) leaves roughly 150k and even when I add the life insurance it falls below 325k. There are no private pensions or other investments , cash, possessions to consider.

Does this sound like IHT is not payable in my case?

BooJewels

I'm sorry for your loss. 

My advice for the recently bereaved in these sort of circumstances is not to start the Probate process until someone actually asks for it, or you can't proceed without it - it doesn't sound like it is likely to be needed.  I didn't need/do it when my husband died - as everything was in joint names.  To get the house put into my name only, they only required a death certificate and it was depressingly easy and quick to do.

Mojisola

williamIV said:

We joint owned out home and we only had the one joint bank account. I spoke to the bank and they don't need probate ,I think everything will come across to myself and money in the bank is almost non existent.

This makes me think that DIY probate is possible because I may not even need it, no one has asked for it so far.

On the basis of what you've said here, it's unlikely that you will need to get probate.

When my Mum died, her will didn't go to probate because almost everything was jointly owned.

It's only if you have something like Premium Bonds that you may find someone demands it.

Wait and see before you start the process.

Land_Registry

If the property was in your joint names then you don’t need probate. The legal ownership passes to you as the surviving sole owner. 

You can apply to update the register at any time using form DJP and an official/certified copy of the death certificate. Our PG provides much wider guidance as required 
https://www.gov.uk/government/publications/devolution-on-the-death-of-a-registered-proprietor

williamIV

Thanks all for your valuable input.

Any view on the Inheritance Tax query? I think I fall inside the 325K threshold but my logic may well be flawed. Will the Inland Revenue give some advice about this?

This forum is so helpful at this very stressful time. It's very much appreciated.

bobster2

You will need to establish whether the life insurance policy pays out in trust (e.g. to you) or forms part of the estate. If it pays out in trust it won't form part of the estate for IHT purposes. Life insurance usually is set up this way.

However, if it's not in trust you probably will need probate because there will then be a large amount of money in the estate that needs to be distributed according to the will. In fact you may even need probate to claim the life insurance proceeds.

williamIV

bobster2 said:

You will need to establish whether the life insurance policy pays out in trust (e.g. to you) or forms part of the estate. If it pays out in trust it won't form part of the estate for IHT purposes. Life insurance usually is set up this way.

However, if it's not in trust you probably will need probate because there will then be a large amount of money in the estate that needs to be distributed according to the will. In fact you may even need probate to claim the life insurance proceeds.

I rang the insurance company quite soon after the death, not to make a claim, but to check that the policy was live. I was concerned because I didn't see the payments coming out in the bank statements and needed reassuring.

Thankfully policy is live which was a major relief.

They just asked me when I'm ready to come back with the death certificate. They made it sound like I didnt need probate. I'll ask about trust but I was under the impression that it should pay off the mortgage?