Estate administration – what’s involved
Estate administration (grant of probate and grant of letters of administration)
1. Obtain details of all estate assets and liabilities for which the grant will be needed;
2. Complete all paperwork to submit to HM Revenue and Customs for inheritance tax purposes
3. Complete application for grant and send to Probate Registry
4. Obtain grant and collect in the estate
5. Settle outstanding liabilities and administration expenses, including any tax due
6. Take steps to distribute the estate to the beneficiaries entitled to receive it.
These are the basic steps and estates can often be more complicated. In fact, there is no such thing as a ‘typical probate case’. Every estate is different and there are a whole host of variables which need to be taken into account in giving you a cost estimate.
The administration of an estate could vary from a simple estate with one beneficiary, one bank account and no property to deal with to a multi-million-pound estate with complex assets, trusts and multiple beneficiaries. There could be overseas aspects to deal with, missing documents (typically shares held in paper form rather than electronically), businesses and more than one property. There are also factors which could complicate the administration – see the key assumptions listed below.
We charge by reference to our hourly rates, to which we add VAT (@ 20%). Please refer to our biographical information which contains details of the members of the team who may be involved in dealing with the matter. Given the variance in the types of estates we work on, it is difficult to provide an average cost.
For a simple estate with one beneficiary and one or two bank accounts, but no property, our minimum charge is £1,500 plus VAT (@ 20% £300) (total cost £1,800).
For an estate involving a number of beneficiaries and mixed assets which could include a small number of electronically shares, bank accounts and a residential property, the average cost is in the region of £4,800 plus VAT of £960 (@ 20%) total cost £5,760.
In addition, please see details of additional expenses called ‘disbursements’ which will need to be paid on behalf of the estate.
In providing these average estimates, we make the following key assumptions:
(1) With family assistance, we are able to speedily identify all assets and liabilities of the estate
(2) We will be provided with current contact details of all relevant parties.
(3) All assets are situated in England and Wales.
(4) There are no technical or other impediments to a grant from the Probate Registry.
(5) There are no claims against the estate by relatives, creditors or others.
(6) All beneficiaries reside in the UK, are at least 18 years of age and can understand and sign documentation
(7) That there are no material disagreements amongst the beneficiaries and/or the trustees.
(8) There is no inheritance tax to pay and the executors do not need to submit a full IHT400 account to HMRC.
(9) The executors agree that we may instruct a third-party accountant to complete tax returns if appropriate
(we will obtain a quote for you prior to passing on this work).
(10) There are no questions raised by HM Revenue & Customs.
(11) There is no claim by the Department for Work and Pensions.
If any of these key assumptions are incorrect or change over time, we will need to provide you with a revised scope of work, revised timetable and revised fee estimate.
In addition to our costs, there will other ‘out of pocket’ expenses (known as disbursements) which you will need to pay.
These are the usual disbursements in straightforward estate administration work:
(a) Probate Registry application fee £155 (no VAT)
(b) Copies of the grant issued at the same time £5-£10 (no VAT) depending on how many copies are needed
(£1.50 per official copy and we usually suggest obtaining one official copy per asset)
(c) Bankruptcy searches – £2.20 (inc VAT @ 20%) per beneficiary
(d) Claims notices in the London Gazette and a local newspaper (protection against unexpected demands for
liabilities) estimated at £225 (including VAT @ 20%)
Our average estimates specifically do not include any advice about the following aspects:
- Property Sale (if applicable)
- Deeds of Variation
- Business or Farming Advice (if applicable)
- Anything else not specifically identified in the ‘Summary of Work Required’.
If applicable, we will price these and any other requirements separately for you.
When necessary, we will, in consultation with you obtain such additional advice as is required from appropriately qualified third parties and provide you with their cost estimates in advance of instructing them. The time taken to complete the administration of an estate can vary significantly. Again, there is no average and it depends on the types of assets and number of beneficiaries involved.
If there is one executor, one beneficiary and only a couple of assets to deal with, the administration could take between three to four months. Depending on other variables, it could take longer, or it could be dealt with more quickly. In a simple estate like this, we would anticipate being able to apply for the grant from the Probate Registry within two months from your first instruction to us.
More complicated estate – more assets, more beneficiaries or other complicating factors can take up to and sometimes longer than a year. The most complex estates can take many years to finalise particularly if there are properties that need to be sold or businesses that need to be wound up. These are average estimates based on our experience. We are committed to providing you with cost estimates and choices about our fees once we have established your specific requirements.