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Tag Archive adminstration of estates

No Will; No Problem?

New research suggests that 60% of adults in the UK don’t have a Will, but is this a problem?

If you die without a Will you are known as intestate, the rules of which are covered under the Administration of Estates Act 1955 (peruse at your leisure).

Who’s your Executor in an intestacy? Well, technically no one. Instead, you have an Administrator who will likely be the person or people who will inherit the majority of your estate.

So no big deal, right? Someone, although you won’t know who, will be there to administer your estate, but how will it be administered. Enter the 1955 Act again.

Priority of inheritance in an intestacy:

  1. Your spouse/civil partner will inherit the first £250,000, with everything above £250,000 split between spouse/cp and children.
  2. If your spouse/cp predeceased you, all shall be split between your children in equal shares.
  3. If no surviving spouse/cp or children, your estate shall pass to your parents.
  4. If no surviving spouse/cp, children or parents, your estate shall pass to your brothers and sisters (or their children) in equal shares.
  5. If no surviving direct family, next of kin (eg. aunts and uncles) shall inherit your estate.

Maybe you’re happy with the above legislation’s forced order of inheritance and think it will suit your estate. The important thing is you’ve thought about your affairs.

Nothing on this site should ever be considered to be legal advice or research but if you do wish to receive advice on any of the content discussed please contact us on 028 3752 5400 and we will be happy to help you. Please note that whilst we will aim to provide accurate information the world changes at a fast pace so always follow up with your solicitor to ensure you are fully up to date with same. For complete Terms and Conditions please see the relevant section of our website.

Terms You’ll Hear When Making a Will

When making your will we’ll try and keep things as clear as possible. You’ll occasionally hear terms you might not be familiar with. So for the curious, here’s a glossary of the legalese.

Jargon Buster –

Administrator – A person appointed by law to finalise your affairs if you die without leaving a Will.

Beneficiary – Anyone who receives something from your Will.

Bequest – (also often called a legacy) A gift in a Will. Gifts are normally pecuniary (a specific sum of money), residuary (generally stated as a percentage share of what is left after all other gifts have been made) or specific (a particular item or property).

Codicil – An addition or amendment to an existing Will.

Estate – The total value of everything you own at your time of death, minus any outstanding commitments.

Executor – A person you appoint to make sure the wishes stated in your Will are carried out.

Guardian – A person appointed by a parent to look after their children in the event of their death before the children reach adulthood.

Intestacy – The situation that exists if you die without a valid Will. Currently provisions for dealing with this are covered under the Administration of Estates Act 1955.

Inheritance Tax- A tax levied at 40% of the value of your estate over the first £325,000. Gifts to your spouse or a charity are exempt. There are other reliefs (agricultural and business property) available.

Nil-rate Band – The portion of your estate you don’t pay inheritance tax on. Currently set from £0 up to £325,000 each, there are ways to increase your nil-rate band if necessary (making less inheritance tax to pay).

Probate – The process that determines whether your Will is valid. It is an application to the Court combining the Executor’s oath and the Testator’s completed inheritance tax account.

Testator (male) and Testatrix (female) – The person making the Will.

Trust – A provision you can put in your Will to treat part of your assets in a particular way after your death.

Nothing on this site should ever be considered to be legal advice or research but if you do wish to receive advice on any of the content discussed please contact us on 028 3752 5400 and we will be happy to help you. Please note that whilst we will aim to provide accurate information the world changes at a fast pace so always follow up with your solicitor to ensure you are fully up to date with same. For complete Terms and Conditions please see the relevant section of our website.

What Happens When You Die?

 

Or more particularly if you’re the person tasked with dealing with someone’s estate immediately after they’ve passed away. If you’ve never had to register the death of a loved one/relative before it may seem daunting at first. Along with the grief, you now need to try and begin to deal with the deceased’s estate. Hopefully, this post will give a brief introduction to what must be done. (As in most cases the NI Direct website can be very useful.)

Once funeral arrangements have been carried out as per the wishes of the deceased the task turns to sorting out their estate. The death must be registered with the local authority within 5 days of the date of death, or in some cases where the death has been referred to the Coroner, a Coroner’s notification certificate will be issued. Administration of the estate of the deceased will break down into two possible processes:

1. When you have a Will.

You’ve drafted your Will, appointed executors and left your property and possessions as you’d like. What does an executor do once you’ve passed away? It’s up to the executor to collect in and gather your estate for distribution as per your Will.This requires a Grant of Probate to be extracted from the High Court. Once the Probate is received an executor is legally bound to administer your estate as instructed by your Will, and they can be held personally liable for not doing so. (No one will be forced to act as an executor against their wishes. Where they refuse to act as executor, this is known as renouncing executorship.)

2.You don’t have a will

If you die without a Will, you are known as intestate. An administrator will need to be appointed to distribute your estate (normally a close friend or family member.) The rules for distributing your estate can be found in the Administration of Estates Act (Northern Ireland) 1955 (if you want to revel in some wordy statute check out the link) and broadly can be surmised as your estate being distributed in the following priority:

  1. Spouse/civil partner,
  2. Children,
  3. Parents,
  4. Brothers and Sisters,
  5. Grandparents,
  6. Uncles and Aunts

(i.e. if no spouse/civil partner the estate shall go to the deceased’s children, if no children, the deceased’s parents etc)

The above list is an overly simplification and monetary limits apply where the estate is above a certain threshold and both a spouse/civil partner and children or parents survive the deceased. The solicitor will explain all of this to the administrator at the outset.

3.Small Estates Indemnity

I know, I know I said there were only two procedures however there is a third, hopefully solicitor-free, option for administering estates which are relatively small in monetary value. Usually occurring where there is no residential property and relatively low balance bank accounts, it may be that an executor or administrator can close the bank accounts without a Grant from the High Court (or the expense of solicitor’s legal fees)! The small estates’ indemnity estate limit varies from bank to bank and isn’t suitable for all small estates, but there is little point in expending legal fees to administer an estate, and lowering potential legacies from beneficiaries, in this case.

I hope you found this useful and as always, any questions ask them in the comments below or contact us!

Nothing on this site should ever be considered to be legal advice or research but if you do wish to receive advice on any of the content discussed please contact us on 028 3752 5400 and we will be happy to help you. Please note that whilst we will aim to provide accurate information the world changes at a fast pace so always follow up with your solicitor to ensure you are fully up to date with same.