Administration: application for a grant Flashcards

1
Q

Who will register a death/organise a funeral?

A

PRs may register a death but this is more likely to be done by the family who then provide the PRs with the death certificate.

Family members usually arrange the funeral-there is a moral obligation to follow funeral wishes set out in a wall.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
2
Q

What must PRs complete in relation to the deceased’s assets and liabilities?

A

The PRs must complete an accurate list of the deceased’s assets and liabilities. It is not possible to obtain the grant or calculate IHT without this information.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
3
Q

How should PRs establish the value of bank accounts?

A

PRs should request from the bank a summary of the account balance on the date of death plus any accrued interest.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
4
Q

How should PRs establish the value of joint accounts?

A

PRs must establish what proportion of the account was owned by the deceased.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
5
Q

How should PRs establish the value of low value chattels?

A

It is acceptable to estimate their value.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
6
Q

How should PRs establish the value of chattels worth more than £500?

A

A formal probate valuation should be obtained.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
7
Q

How should PRs establish the value of quoted shares?

A

They are valued by taking the lower of the two prices on the Stock Exchange Daily List and adding ¼ of the difference between the higher and the lower value.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
8
Q

How should PRs establish the value of private co shares/partnership interests/sole trader business?

A

A specialist valuer would usually be instructed.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
9
Q

How should PRs establish the value of land?

A

PRs will usually instruct estate agents to prepare a valuation and an average value is used. Jointly owned land the value of the deceased’s share should be established.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
10
Q

Where do executors and administrators derive their authority to act?

A

Executors derive their authority to act from the will.

Administrators derive their authority to act from the grant.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
11
Q

When will an executor named in a will be unable to act?

A

-If they pre-deceased the testator

-If they are a minor, but power can be reserved to the minor

-Lack capacity

-Are the testator’s former spouse/civil partner and the divorce/dissolution took place after the will was made

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
12
Q

What is the minimum and maximum amount of executors?

A

Minimum of 1 and a maximum of 4.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
13
Q

What is a grant of double probate?

A

Power can be reserved to any remaining executors, meaning they can apply at a later date if vacancy arose and the administration remained incomplete. In this instance, they would apply for a grant of double probate.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
14
Q

What is the chain of representation under S7 AEA 1925?

A

This will apply if the last surviving executor (E1) dies having appointed an executor of their own estate and this person takes out the grant probate for E1’s estate (E2).

S7 AEA 1925 provides that E2 automatically becomes executor of the original testator’s estate as well as being executor for E1’s estate. No additional grant is required.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
15
Q

If the chain of representation cannot operate, what process is followed and what are the three requirements?

A

If the chain of representation cannot operate a second grant will be issued-a grant of letters of administration de bonis non. Three requirements must be satisfied:

-the administration is incomplete;

-there are no remaining PRs; and

-there has been a previous grant of representation.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
16
Q

When is a grant of letters of administration (with will) the appropriate grant?

A

Where the deceased left a valid will but there are no executors who are willing/able to act. This is the correct grant even if the will fails to dispose of all the estate.

Their entitlement to apply derives from Rule 20 NCPR, not the will.

17
Q

What is the statutory order of entitlement to be appointed as administrator as per NCPR 20 1987 under a grant of letters of administration with will?

A

The statutory order of entitlement to be appointed as administrator under a grant of letters of administration (with will) is:

a) executor

b) trustee of the residuary estate

c) any residuary beneficiary, or a beneficiary of the estate under intestacy

d) the PRs of anyone in (c) other than a trustee or life tenant of the residue

e) any other beneficiary or a creditor

f) PRs of anyone in (e)

18
Q

When is a grant of letters of administration the appropriate grant?

A

Where the deceased died intestate.

Their entitlement to apply derives from Rule 22 NCPR.

19
Q

What is the statutory order of entitlement to be appointed as administrator as per NCPR 22 1987 under a grant of letters of administration?

A

The statutory order of entitlement to be appointed as administrator under a grant of letters of administration is:

a) surviving spouse or civil partner

b) children of the deceased

c) father and mother of the deceased

d) whole blood siblings

e) half-blood siblings

f) grandparents

g) uncles/aunts of whole blood

h) uncles/aunts of half-blood

20
Q

What is renunciation?

A

When an executor formally renounces their right to apply for probate and the administration continues as though they hadn’t been appointed.

The executor must sign a form of renunciation which must be submitted to the probate registry by those who subsequently apply for the grant.

21
Q

Can an executor renounce if they have intermeddled with the estate?

A

No, and the Court will not accept an attempt to renounce.

22
Q

When does a person intermeddle with an estate?

A

A person intermeddles when they take steps indicating they have accepted their appointment and are fulfilling the duty to administer the estate.

Acts of common humanity such as arranging a funeral or taking steps to secure the estate assets do not amount to intermeddling.

23
Q

Describe the process of an executor reserving power.

A

If an executor does not want to act initially, but wants to retain the option to apply for probate later, they may reserve the power to do so but there must be at least one other executor who does take out the grant of probate.

24
Q

Can an executor reserve power if they have intermeddled?

A

Yes, this is still possible.

To act later, the executor who reserved power can apply for grant of double probate to run concurrently with the original grant.

25
For how long can a PR delegate their functions to an attorney?
S25 Trustee Act 1925 confirms that a PR may delegate their functions to an attorney for a maximum of 12 months. This can be reviewed if needed and notice should be given to other executors.
26
What is the PRs duty under S216 IHTA 1984?
The PRs of an estate have a duty under S216 IHTA 1984 to: -deliver an account to HMRC regarding the deceased’s estate -pay any IHT due
27
What is the deadline for submitting the IHT account to HMRC?
12 months from the end of the month in which the death occurred.
28
What is the deadline for paying IHT due?
6 months from the end of the month in which the death occurred, after which interest becomes payable on the unpaid tax.
29
What is the IHT instalment option and for what assets is it available?
Under SS227-228 IHTA 1984, the IHT due in respect of certain assets may be paid by 10 equal annual instalments. Instalment option is only available in respect of the IHT attributable to the following assets: -Land and buildings -Company shares/securities giving the deceased control -Some unquoted company shares/securities that did not give control -Farms or interest in a farming business -Business or interest in a business -Timber
30
What is a low value excepted estate?
This is where there is no IHT payable because the gross value of the estate is below the NRB (current NRB plus any TNRB from their spouse).
31
What is an exempt excepted estate?
This is where the gross value of the estate is no more than £3m, but no IHT is payable because after debts are deducted and spouse/charity exemptions are applied the net value of the estate is below the NRB (current amount and any transferred). Only the spouse/charity exemptions apply.
32
What types of estates cannot be excepted from IHT due?
If any of the following apply, the estate cannot be excepted: -the deceased made a gift with reservation of benefit that subsists at death -the estate includes either more than one trust interest, or a single trust interest worth more than £250,000 -foreign assets are worth more than £100,000 -the value of specified transfers exceeds £250,000 -a claim for the RNRB is being made
33
What are the two common options available to pay the IHT due?
Direct Payment Scheme-banks or building societies can be asked to make a direct payment from the deceased’s accounts to HMRC by telegraphic transfer under the Direct Payment Scheme. PRs must complete schedule IHT 423. Borrowing-from a beneficiary, often interest free, or from a bank, where commercial rates of interest will apply.
34
What are the three types of professional applications?
-Mandatory online application: most grants of probate -Online application possible but not mandatory: includes some simple applications under NCPR 20 and 22 -Mandatory paper application: includes non-standard grants and more complication applications under NCPR 20 and 22
35
What form is required for a probate application where the deceased did not leave a valid will?
PA1A: deceased did not leave a valid will (NCPR 22 applies)
36
What form is required for a probate application where the deceased did not leave a valid will?
PA1P: deceased left a valid will
37
What additional items should be included in the probate application?
-Probate Registry fee -Death Certificate -The original will -Any form of renunciation -IHT 400 -Any power of attornery/affidavits