Administration of the estate Flashcards
What is a breach by a PR called?
Devastavit
How can PRs protect themselves against an unknown beneficiary/creditor?
Advertise in the London Gazette and a relevant newspaper
Make other notices that’d be directed by the court
Wait 2 months to distribute the estate
How can PRs protect themselves against missing beneficiaries/creditors?
Apply for a Benjamin order
How can PRs protect themselves against claims under the Inheritance (provisions for Family) Act?
Wait 6 months from the date of grant of representation/probate to distribute
Which payments must PRs first make?
- D’s debts and liabilities
- funeral expenses
- testamentary expenses
What is a solvent estate?
Where there’s enough assets to pay all debts + liabilities (regardless if anything is left over or not)
Statutory order for payment of debts in solvent estate
- secured debts
- unsecured debts:
- property undisposed of by will
- residuary gift
- property specifically for paying debts
- property charged with paying debts
- fund for pecuniary legacies
- property specifically devised
Priority order for payments in insolvent estates
- secured debts
- funeral + testamentary + administrative expenses
- unsecured debts
How to transfer a specific legacy of land
Using an assent
How to transfer a specific legacy of shares
Using a stock transfer form
When can loss relief be claimed?
When PRs must sell assets for lower than market value at the date of death to pay IHT
If assets sold within 12 months of death, and they’re qualifying (shares in quoted companies + unit trusts)
What to do once all IHT has been paid
Apply for confirmation using form IHT30- HMRC will provide a clearance certificate, releasing everyone from IHT liability
What are the income tax rates for income and dividends for PRs?
Dividends: 8.75%
Income: 20%
What income tax relief can PRs claim?
Relief for interest paid on a bank loan to pay IHT
What is the CGT rate for PRs?
20% (or 24% on residential property)
