Losing a loved one is a challenging and emotional time for families and friends. There is considerable amount of stress just dealing with the passing of a love one and to add to this is paying of inheritance tax within six months of death and completion of the Inheritance Tax return form within 12 months of death.

Amidst the grief, the probate process adds a layer of complexity, particularly when it comes to dealing with property.

You can only sell the property after a Grant of Probate is issued and this is legal document that allows the executor(s) to transfer the property into the beneficiary’s name so that the property can be sold.

Understanding probate process

The first step in this probate process is to prepare inheritance tax returns to establish the inheritance tax position and the gross and net assets of the estate. HMRC will extract the gross and net assets figures of the estate and will check that the inheritance tax is paid before notifying the Probate Office to commence dealing with the probate application. Please note that the Grant of Probate is not issued until the inheritance tax is paid.

The inheritance tax return form shows all the individuals assets and liabilities as at date of death. Therefore, valuations are required as at date of death of shares, bank account and property.

Part of the process of reporting a property on the inheritance tax return is having a valuation of the property as at date of death which is required. We would recommend that this is done by a Royal Institute of Chartered Surveyors (RICS) qualified surveyor as HMRC uses people with the same qualification to review the valuations when submitted to them.

Depending on the Will, who is inheriting and what assets are being inherited will determine the amount of inheritance tax to pay. However, if the will is not tax efficient a deed of variation can be made to reduce the amount of inheritance tax paid.

This process can be difficult, so it is important to understand all the steps you need to take with help from an expert.

After the Grant of Probate is issued:

Please place an advert in the London Gazette and local paper as soon as possible. Placing a deceased estates notice demonstrates that enough effort has been made to locate creditors before distributing an estate to its beneficiaries (the people who will inherit the estate).

This protects the executor from being personally responsible for money owed to any unidentified creditors. Once the deceased estates notice has been placed, creditors have two months and one day to make a claim against the estate.

Depending on the Will the executor can use the Grant of Probate to transfer assets into beneficiaries’ names or assets can be put into executor’s names and sold with the proceeds collected in an executor account.

After the assets are collected and debt payments of the estate have been made, the remaining balance can be split between the beneficiaries according to the Will. An estate accounts produced which can be presented to the courts if requested.

For more advice on the above, get in touch with our experienced probate team for advice. We can also provide probate guide which covers all aspects of the probate process by emailing contact@grunberg.co.uk