Probate is the legal process of distributing a person’s assets after they have passed away. If you have recently been granted probate, you may be wondering what the next steps of the process are once it has been granted.
There are several things you will need to take into consideration. This includes any delays that may occur, to the time it will take to receive your inheritance. In this guide, we will be discussing everything you need to know.
Collect the Assets of an Estate
The executor of the will or the administrator of the estate will need to collect the assets and distribute them accordingly. Sometimes they can be referred to as the personal representatives on the grant document.
To collect and distribute the assets legally a grant of probate will be needed if there is a will present. If the deceased person didn’t have a will, a grant of letters of administration is provided as an alternative to this. When dealing with a property it is advised to get probate house insurance to protect a property during the probate process.
What Happens if You Find Assets After Probate?
If you find assets after probate has been completed, the assets will need to be flagged. This is because they can affect the estate's tax liability. The assets must be valued if the grant of probate has already been completed. In some cases, some of the probate services will need to be completed to ensure the assets are distributed correctly.
The assets found will change the total value of the estate, which will then impact the Inheritance Tax. HMRC needs to be notified of this to ensure all Inheritance Tax is paid correctly. The grant of probate will need to be amended to ensure the assets are included.
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Close Bank Accounts
Any remaining bank accounts of the deceased will need to be closed. In most circumstances, a Grant of Representation is needed. The personal representative can then close or withdraw any money from the deceased person’s account.
In some circumstances, a bank can release money without a grant. The limit for this will be stated on the individual bank’s website. For example, the limit for Barclays and Lloyds is currently £50,000. It’s useful to check this before you apply for a grant.
To close a bank account, the executor or administrator will need to provide the following documentation in addition to the grant:
Death certificate
A copy of the will (if present)
Your ID (passport or driver’s licence)
Proof of address (utility bills)
Every bank will have its own separate process regarding the account closing and their probate thresholds. If the money in the account is less than £5,000 in England, Wales and Ireland, the funds can be released without probate in some instances. The threshold is £10,000 in Northern Ireland. Any funds over this amount will need to go through probate.
Banks will only release money for probate fees in limited circumstances. They can release money for funeral costs and Inheritance Tax if they are part of a Direct Payment Scheme. Other than these purposes, banks will withhold the money until probate has been granted.
With a Grant of Representation, a person can also legally transfer and sell a property if needed.
How Long Do Banks Take to Release Money After Probate?
Within 2 weeks is the average time it will take for a bank to release money. This will only occur after they have a Grant of Probate and the process has been completed. The Probate Registry will send the grant to the personal representative. The personal representative will then send the grant and any other documents required by the bank to the bank.
If there is property or shareholding, the estate administration process will take longer to complete. However, there shouldn’t be a delay in obtaining money from the bank account.
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Collect Pensions and Insurance
If the deceased person has a life insurance policy in place, this can be used to pay off specific debts, such as an existing mortgage. The policy trustee can help to determine who is paid regarding this. Questions will be asked about the circumstances of the death and whether the life insurance covers this.
In most cases, life insurance is a separate process to probate and the beneficiary will need to apply for this separately. In the unlikely event of the beneficiary dying, the life insurance payout will then become part of the probate process.
After a person dies, their beneficiaries are entitled to the person’s private pension. A state pension can only be claimed by a surviving spouse or civil partner. Pension plans don't form part of the estate. As a result, the money is free from Inheritance Tax.
It’s important to note that benefits may not stop instantly and this can lead to overpayments. The Department for Work and Pensions (DWP) can investigate this, and claim back any money owed. Investigations can typically take around 6-9 months to complete.
Selling the Property
A property will need a Grant of Probate for it to be sold in the probate process. Houses aren’t commonly sold during the probate process. This only typically happens if the property has joint tenants or is part of a trust.
If you are eligible for this to occur, it will delay the receiving of inheritance until after the home has been sold. This will only typically happen if funds are needed from the estate during probate and there are no other assets that can be used.
If you are selling your home during probate, it’s useful to hire a surveyor to carry out a property valuation for you. This will help determine how much the house is worth and the price it can be sold for. It will also allow you to calculate how much Inheritance tax will need to be paid.
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If the house is owned by more than one person, the joint tenancy means the house doesn’t have to go through the probate process. In this instance, the property ownership will be given to the other person on the title deeds. A deceased joint proprietor (DJP) form will need to be filled in. The partner or spouse is then free to sell the home, even if it’s during the probate process.
While a property can be placed on the market, unless a trust holds the property, it cannot be sold until probate has been completed. If there are multiple beneficiaries of a home, they must be in agreement about if they want to sell the home. If one beneficiary doesn’t want to sell the property but the other does, they can choose to buy the person out of their portion.
When selling a home, it's important to seek assistance from a professional conveyancer. This will be a majority of your probate costs. They will guide you through the selling process and complete all the legal aspects for you. We can connect you with up to 6 verified and trusted conveyancers in the area through our online form. We can also help you to save up to 70% on your overall conveyancing costs.
Hiring a House Clearance Company
If you are looking to sell a property after probate, you may need to consider house clearance. While this is something you can do yourself, it can be a lengthy process. Additionally, any unwanted items will need to be disposed of safely and legally. This is why many people opt to hire a house clearance company to carry this out on their behalf.
By law, house clearance companies must hold a valid Waste Carriers Licence and be covered by Public Liability insurance. This ensures any waste is disposed of correctly and it helps you to determine whether a company is trusted and verified.
A house clearance company will assist you in clearing the home and will keep any assets or valuables you want to keep aside. Here at Compare My Move, we can help connect you with up to 6 local house clearance companies. Simply fill out our online form to compare and contrast house clearance quotes. We can help you to save up to 70% on your total house clearance costs.
All the companies we work with have passed our strict verification process. You can rest assured that their services are of the highest quality. Customer service is important to the house clearance companies we work with. They understand that probate clearances can be a tough time for many, and they ensure to tailor their services to meet your specific needs.
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Set Up a Bank Account For Funds from the Estate
It is always recommended for the executor to open a bank account for the funds from the estate. This can be set up once the executor has been given the grant or confirmation. They are the only people that can legally set this up.
Once probate is complete, the financial assets from the estate can then be paid into this account. This way it is easier to keep track of the inheritance and distribute it accordingly. It also keeps funds separate from the executor's personal account. This is beneficial in the event of a dispute between beneficiaries.
Settle Outstanding Debts
Any outstanding debts will need to be settled and paid off. This can include extracting money to cover the cost of administering the estate and funeral costs.
Outstanding debts influence how long it will take for a person to receive their inheritance. Creditors will charge debts and repayments to the estate before any inheritance is agreed upon.
While all debts will need to be paid off during probate, some are of a higher importance. This is to ensure the most important debts are a priority. Here is a list of debts in order of priority:
- Mortgage repayments and secured debts (loans)
- Priority debts (council and Income Tax)
- Unsecured debts (credit cards and utility bills)
Assets such as valuables or cars can be sold and used towards settling debts if needed. Informing creditors about the person's passing and settling debts will delay the probate process.
There may be debts you are unaware of, such as credit cards and personal loans. The executor or administrator can protect the estate by creating a statutory advertisement. This is a deceased estates notice which declares the person's passing.
This advertisement is public and is placed in local newspapers and Gazettes. It serves as a way for creditors to contact the executor regarding any outstanding debts. It protects the estate as they have provided enough opportunity for creditors to come forward during probate.
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Distribute Funds to Beneficiaries
Once probate is complete, it’s the executor of the will’s responsibility to distribute the funds and inheritance accordingly. This will typically take 6-12 months to occur after probate.
During this time claims and disputes can be made in regards to the assets. Money can take between 3-6 weeks to be received in simpler cases.
In some instances, if the estate administration is taking a long time to complete, an interim payment can be paid to the beneficiaries. This typically happens if a property is being sold and is often referred to as interim distribution.
An interim payment consists of a portion of a person's inheritance or entitlement provided before probate has been completed. The administrator or executor will decide whether this interim payment can be made. They can also decide the amount of funds that are released.
How Long After Probate is Granted Does It Take to Receive Inheritance?
On average, it will take between 6-12 months after the probate is granted or the house is sold for a person to receive their inheritance. This is an estimated number, and the actual waiting time will vary depending on how complex the estate is.
Typically, the larger the estate is, the longer you will have to wait. You may also experience delays with the Probate Registry which can cause the waiting time to be extended. Here are some additional factors that will influence the time it takes for probate to be granted:
Complicated Estates
If the estate has a lot of complicated finances, probate may take longer. This is because of how long it will take to value the assets of the estate. Specialist items, such as antiques or artwork can also lengthen this process. If there are properties included, the estate administration process is more complicated.
No Record of Assets
If there isn’t a record of the assets the person has left, this can greatly impact how long it will take to receive the inheritance. All items will need to be accounted for and checked to ensure they are part of the estate.
No Will Present
If there is no will present or if the will has been updated or changed this can lead to delays or disputes. The deceased person’s assets will need to be inherited by the correct people. There may be conflicting wills to look at as a result.
These need to be valid and legitimate and all wills will need to be checked and verified. This is to ensure any changes made are genuine. In many cases, updates to a will are agreed upon by the beneficiaries in advance.
In some instances, a will might not be valid. This can happen if the will is not completed or signed correctly. If the person wasn’t of sound mind when the will was created, or there is evidence of fraud or pressure placed on the individual, this will also invalidate the will.
Inheritance Tax
If the deceased person’s estate is worth more than £325,000 you are liable to pay Inheritance Tax (IHT). This tax covers money, property and possessions. In this instance, how long it will take you to receive inheritance will be longer. This is because you will need to ensure this tax has been accounted for and cleared by HMRC.
Probate Disputes
Probate can bring about disputes, especially if a will isn’t involved in the process. If disputes need to be investigated this will often require legal assistance. This will increase the time it takes for people to receive their inheritance.
Selling Shares
Shares are more complicated assets to sell as they are usually sold through a share registrar or a stockbroker. There is a lot of legal documentation that needs to be completed such as providing share certificates. This can be time-consuming and increase the time it will take for you to receive inheritance.
Foreign Assets
If there are any foreign assets in the estate this will prolong gaining the inheritance, especially if the property is being sold. You will need to liaise with the necessary solicitors and foreign estate agents which can take longer than selling a home during probate in the UK.
If the Beneficiary Is Not Present
If the beneficiary is missing an investigation will need to take place to find them. This can involve a tracing agent. This process can be quite long-winded and is often a common reason for delays in the probate process.
Read more on: How Long Does Probate Take in the UK
How Quickly Can You Receive Inheritance?
In some cases, probate can take as little as 3 months to complete. However, this only tends to happen if the estate is small and straightforward.
There’s no way to make the probate process shorter. If the application process is all correct, this will help when it comes to distributing the estate. If you don’t have to pay Inheritance Tax the process will typically be shorter.
If you want the process to be more streamlined and have potentially fewer delays it’s useful to hire a probate solicitor. While a solicitor is not a legal requirement, it’s highly recommended that you hire the assistance of one.
If there isn’t a property that needs to be sold, the process may be quicker. This applies to a property that is part of a joint estate. The property will be transferred to the surviving owner instead of being inherited. This falls under the intestacy rules.
