Administration: Executors (entitlement to grant) Flashcards
What are the pre-grant steps?
Death certificate / funeral
Secure estate assets
Locate will / codicil
Basis of distribution and identify beneficiaries
Schedule of assets and lifetime transfers
Do the PRs deal with obtaining the death certificate and the funeral?
PRs may register a death (and have an underlying duty to deal with the body) 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 but PRs might do this if necessary.
When can the funeral take place?
After the death has been registered.
When registering the death who should be notified?
Government organisations such as HMRC & DVLA can be notified of the death via a centralized service when registering the death.
Will a copy of the will suffice for obtaining the grant?
No unless special permission from the probate registry has been obtained.
If it appears the deceased has died intestate, what must the PRs do?
PRs should make enquiries to confirm this before proceedings.
If there is evidence a will was made, but it cannot be located, the PRs will need to find out what happened. If a valid will has been lost appropriate steps must be taken to re-construct it.
Why must PRs compile an accurate list of the deceased’s assets and liabilities?
To:
- identify and value estate assets
- identify the deceased’s creditors
- work out what steps are required to manage the distribution of assets
- calculate IHT due
- establish whether the estate is solvent
- estimate what each beneficiary is entitled to.
Why is creating a list of assets and liabilities not always straightforward?
Because you are relying on the family members to provide accurate information.
If there are no family members a PR may need to search the deceased’s home.
Once the PRs have a schedule of assets and liabilities what must they do?
They should contact the appropriate organisation to:
- notify them of the death and provide a copy of the death certificate
- request confirmation of the value of the asset at date of death
- request instructions for how to close an account/transfer ownership of an item to the PRs.
How should PRs establish the value of bank accounts?
PRs should request a summary from the bank of the account balance on the date of death and any interest which has accrued.
Joint accounts: PRs must establish what proportion of the account was owned by the deceased
How should PRs value low value chattels?
Usually acceptable to estimate their value.
Single items worth more than £500 (or unusual items) a formal probate valuation should be obtained.
How should PRs value quoted shares?
Valued by taking the lower of the two prices on the Stock Exchange Daily List and adding one quarter to the difference between the higher and lower value.
How should PRs value private co shares / partnership interests / sole trader business
Specialist valuer would usually be instructed.
If the deceased held shares or other financial investments through a financial services company the broker will provide a list of shareholdings / investments and the date of death values.
How should PRs value land?
PRs will usually instruct estate agents to prepare a valuation. Commonly more than one estate agent is instructed and the average value is used.
Where land is co-owned the value of the deceased’s share should be established.
Where should debts owed by the deceased not be repaid by PRs?
The deceased had borrowed money to finance the purchase of an IHT excluded asset
A debt owed by the deceased is never actually repaid from the estate funds.
