Simplified Probate Procedure for an estate that is liable for Inheritance Tax

It is best to set this out as a series of steps, but please bear in mind this is a very simplified explanation of the probate procedure and each case is different:

1. Register the death in the Local Authority’s register of Births, Deaths and Marriages and obtain death certificates.

2. Forward a copy of the death certificate to all institutions in which the deceased had a financial investment to inform them of the death, ask for a ‘date of death balance’ and confirmation of all assets/debts.

3. Forward a copy of the death certificate to all utilities and creditors to inform them of the death and ask for confirmation of all debts.

4. Complete IHT400 if the estate is above the nil-rate band and the estate is being paid to Beneficiaries who are not exempt from paying IHT. HMRC publishes the current and all previous nil-rate bands on its web site.

5. As a very rough guide, spouses, civil partners and charities are Beneficiaries that do not have to pay IHT and are called ‘exempt Beneficiaries’, while most other legal entities, including children and grandchildren do have to pay IHT and are therefore called ‘non-exempt Beneficiaries’. The IHT400 is a substantially longer document than the IHT205 and goes into considerably more detail for the estate.

6. Calculate the IHT due from the information in the IHT400. IHT is charged on the value of the net estate at 0% up to the value of the nil-rate band in force at the date of debt, and at 40% of the balance of the estate.

7. Draw up the Oath for Personal Representatives either as an Oath for Executors and Exhibit the original Will to it, or as an Oath for Administrators if there is no Will.

8. Take the Oath to a solicitor or County Court to swear it.

9. Obtain a tax reference number from Her Majesty’s Revenue and Customs (HMRC)

10. Send HMRC the IHT400 together with a cheque made payable to HMRC quoting the reference.

11. Once HMRC agree the tax paid is correct, the HMRC send a discharge form, the sworn Oath, Will (if there is one) and Probate fee to the most convenient Probate Registry.

12. The Probate Registry will check the documents and either ask for amendments to be made or grant Probate or Letters of Administration.

13. Send copies of the Grant of Probate or Letters of Administration to all institutions to release funds

14. Gather in all the assets and pay all the debts.

15. Draw up Estate accounts setting out all the assets and debts, of the estate, the costs of administering the estate and the final distributions to the beneficiaries.

16. Distribute the remaining assets to the beneficiaries in accordance with the Will or rules of Intestacy.

This article was written via Paul Handford at RWFC

If you have you have any questions or queries regarding the above article please e-mail Paul Handford

Also see:

Probate procedure not liable for inheritance tax
What is a probate?
Sell probate property
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