What happens to a person’s estate if there is no Will?
When a person dies without a Will, their estate is administered according to the rules of intestacy. Under these rules, the law decides who will administer their estate (‘the administrator’) and who will inherit it, rather than the person themselves.
The person’s spouse or civil partner will inherit the first £270,000 of the estate plus all general personal belongings and half of the remaining estate. What is left is shared amongst the person’s children or even grandchildren or great grandchildren in some circumstances.
When somebody has no close relatives, their estate goes to the government or the Crown.
What happens to an estate when there is a Will?
Making a Will is very important. It means an estate is distributed according to a person’s wishes. In addition, the Inheritance Tax bill is likely to be lower and estate administration quicker and more straightforward.
When someone makes a Will, they choose one or more executors themselves. It is the executor's responsibility to administer their estate in accordance with law and the terms of their Will. An executor can be a close relative, somebody the person has known and trusted for a long time, or a professional such as a solicitor.
What is the difference between grant of probate and letters of administration?
A grant of probate confirms the authority of the executors named in the will to administer an estate. A grant of letters of administration confirms the authority of an administrator, where there is no will, in the same way.
When there is a Will, the named executor is issued a grant of probate by the court.
When there is not a Will, somebody – usually the next of kin – will need to apply to the court to be the estate administrator. Once they have permission to manage the estate, they will need to apply for letters of administration.
What are the duties of an executor and an administrator?
An executor and an administrator have many duties to carry out. They have a legal duty to act in the best interests of all the beneficiaries and to prevent losses to the estate.
- Applying for grant of probate or letters of administration
- Telling all relevant organisations that the person has died, including banks and utility companies, and closing the person’s accounts
- Paying for the funeral. These costs can be recovered from the person’s estate.
- Valuing the estate by identifying all the person’s outstanding debts and assets
- Finding missing assets
- Paying the person’s outstanding bills and debts
- Paying taxes, including Inheritance Tax, Capital Gains Tax and any outstanding Income Tax
- Finding the beneficiaries of the Will
- Distributing the estate to the beneficiaries correctly
If you are an executor or an administrator, our solicitors at Davisons can guide you through the entire process giving you peace of mind. You can claim legal fees back from the estate as part of the probate process.