No-one wants to leave a financial muddle after they die. In this podcast, finance expert Jason Butler and Age Space founder Annabel James discuss professional and personal experiences of how best to organise and prepare so that probate is as easy as possible.
Jason explains what probate is and how it works
Probate is the process of gathering together everything that someone owns, dealing with any debts they have to pay out and distributing the remaining assets to those who should receive them.
When someone dies, after obtaining a death certificate and registering their death,ย you will need to submit an account of the value of their estate to the Inland Revenue. You can do this yourself online, or on paper (IHT 400 form), but the latter is more time-consuming. Most people will employ a probate practitioner or lawyer to help with this.
What about Inheritance Tax?
Before you can distribute a personโs assets, you must tell the Inland Revenue if you owe inheritance tax on the estate. You pay 40% over a certain amount – this could be around ยฃ320,000 for individuals, or up to ยฃ950,000 if they had a spouse who died before them and had exemptions. You can ask to pay inheritance tax in instalments, but you have to pay it in full when you sell the property.
Read our guide to inheritance tax for more information on thresholds, rates and gifts.
Jason's advice on preparing for Probate
You can prepare for probate by:
- Making sure the person in question has an accurate and up to date will, otherwise their assets will be distributed according to the law of intestacy;
- Helping them to simplify their financial assets, e.g. by consolidating all savings into one savings account;
- Identify who will be the executor of the personโs estate when they die. The executor is legally responsible for providing an account of the deceasedโs estate, which is everything that has come in and out of their estate – a lawyer can also help with this process.
- If you donโt feel confident overseeing this process on your own,ย you can hire a professional to help with this, but do your research and compare quotesย – Jason recommends using a professional solicitor, over someone who is not a qualified lawyer.
If youโve enjoyed this episode, and itโs been useful, please do rate and review us, so that more people can find us. You can listen and subscribe to Age Space Podcasts on iTunes, or wherever you get your podcasts.ย
Show produced by Husain Husaini atย Wire Free Productions.