Costs and fees – Administering a person’s estate after death
Understanding the Administration of a Person’s Estate after Death
We can tailor the service provided to your precise needs and can either deal with all matters arising from the administration on your behalf or assist you with certain elements, such as obtaining the Grant of Representation.
We can contact all asset holders and debtors on your behalf to obtain full details of assets and liabilities of the estate. Our legal costs are payable from the Deceased’s estate.
When we have obtained details of all the assets and liabilities, we will prepare the necessary Return for HM Revenue & Customs and claim any appropriate tax reliefs on your behalf.
A Legal Statement will also be prepared for the Personal Representatives to submit to the Probate Court. This will enable a Grant of Representation to be obtained and authorise the Personal Representatives to collect the assets in the estate.
We will realise assets, settle liabilities, advise on Statutory Notices and Dependency Claims, and distribute assets to beneficiaries.
Key Stages in the Matter and Timeframe
The first step is to ascertain and value the assets and liabilities in the estate. The time scale for obtaining this information depends upon the complexity of the assets within the estate and whether a Financial Assets search is required. A typical estate would take from 6-12 weeks to complete this first stage.
When all assets and liabilities have been received, we prepare the HM Revenue & Customs Return and Legal Statement for approval of the Personal Representatives. This aim to do this within a fortnight of receipt of all the relevant information and we will write to the Representatives explaining the procedure for submitting the documents to the Probate Court and HM Revenue & Customs (HMRC).
Where the estate is not required to submit an Inheritance Tax Return to HMRC, we expect to receive the formal Grant within 16 weeks of submitting it to the Court. If a full Inheritance Tax Return is required, this makes the process of obtaining a Grant of Representation longer, but it is dependent upon the turnaround times of HMRC and the Probate Registry at that time.
When the Grant has been obtained, we would collect and realise the assets; we would settle liabilities, and place Statutory Advertisements for Creditors, if appropriate. The timescale for realising assets and setting liabilities depends upon the type of the assets and liabilities within the estate. In a typical case this would take between 6 and 12 weeks.
The final stage is to prepare Tax Returns for the Administration Period to HMRC and the Final Estate Accounts, which includes calculations of monies due to the beneficiaries. Due to the potential for claims by dependents under the Inheritance (Provision for Family and Dependents) Act 1975), we may advise that distribution of assets is deferred until 6 months from the Grant.
We will discuss the potential for dependency claims in detail with the Personal Representatives and can distribute to beneficiaries as assets are realised in appropriate cases.
Explanation of Fees and Expenses
The fees in a Probate matter can vary and will depend on the individual circumstances involved.
We will always discuss our fees with you and agree the basis of our charges before we start any work on your behalf. We will provide you with an estimate of our likely fees at the start of the matter (or as soon as we are able to assess the extent of the estate and the work involved). The hourly rates of all members of our team who may be dealing with the matter will be provided to you at the start of the matter.
If, during the matter, there are unforeseen complications we will always inform you and we will explain what these are and what effect these complications have on the likely costs. We will then let you have a revised estimate of costs.
Below is a general overview of the different levels of service available and the costs involved. We appreciate that not all estates are the same and we are happy to discuss provision of a bespoke probate service, tailored to your individual requirements.
Obtaining the Grant of Representation only
We can assist you with obtaining the Grant of Representation only. The personal representatives would then deal with the remainder of the administration of the estate themselves.
Each case is reviewed in accordance with individual circumstances. This service is usually provided on a fixed fee basis with our fees starting at £1350 (plus VAT at 20%) and expenses (as noted below) for Grant of Representation applications where an Inheritance Tax return is not required, and the personal representatives have provided us with all the necessary information regarding assets and liabilities. Where an IHT 400 (detailed financial statement for HMRC) is required, then our fees will be quoted at the start of the matter upon consideration of the facts of the estate. In the majority of cases the fees will start from £3000 plus VAT and expenses.
Full Administration of the Estate
For the full administration of the estate our fees are usually 2.5% of the value of the gross estate (the total value of all the assets before deducting any liabilities) plus VAT at 20% subject to a minimum total cost of £2,500 (plus VAT of £500) and expenses (as noted below). However, the exact legal fees will depend on a number of matters and no estate is exactly the same to administer. Our fees will reflect the requirements of the matter and the percentage rate will vary depending on circumstances. We will always discuss this with you before commencing work.
Provided below are some examples of estates where the percentage noted above may vary:
An example scenario where a lower percentage rate would likely be applicable:
The estate is considered to be “high value”, for example in excess of £1 million, but the Will is very straightforward i.e., there are one or two residuary beneficiaries and no trusts, and the assets are all held in one or two bank accounts.
An example scenario where a higher percentage rate would likely be applicable:
The assets of relatively low value, for example £100,000, but there are complexities in relation to the estate, such as an invalid Will, numerous or missing beneficiaries or claims against the Estate.
The exact cost will depend on the individual circumstances and the complexity of the matter. Factors that can affect the potential cost of the administration include:
- Whether there is a valid Will;
- The complexity of the Will;
- Whether there is more than one property;
- The number of assets;
- The extent to which there are other intangible or unusual assets;
- Agricultural and/or Business Property;
- The number of Beneficiaries and their age;
- Trusts included in the Will;
- Missing Beneficiaries;
- Disputes involving Executors and/or Beneficiaries;
- Claims by Beneficiaries or other persons against the Estate;
- Whether there is Inheritance Tax payable;
- If the Executors are required to submit a full account to HMRC;
There will be additional costs and expenses that we incur on your behalf during the administration of the estate, payable to third parties, such as court fees. We handle the payment of these on your behalf to ensure a smoother process.
Likely expenses are as follows*:
Probate application fee of £279 (to include 4 Official copies);
Bankruptcy-only Land Charges Department searches (£2 per beneficiary);
Notice to Creditors advertised in The London Gazette and a local newspaper. These Notices protect the Personal Representatives against unexpected claims from unknown creditors. Approximately £220 Plus VAT at 20%;
Financial Assets Search. These searches reduce the risk to Executors of assets being discovered following completion of the Administration, which can result in additional costs. £185 plus VAT at 20%
Valuers’ fees, for valuing assets for probate purposes. For example, Estate Agents, Chartered Surveyors or Stockbrokers. These fees vary and will be confirmed and agreed with you at the time.
Land Registry Documents £3 each.
* This is not an exhaustive list
Matters which Are Not Included in the Costs Explanation above
Our estimate of costs and timescales do not include matters which are not formally part of the administration of the estate but may be necessary, including:
- Dealing with the sale or transfer of any property in the estate
- Assets held in trust or policies held outside the estate
- Assets of a pre-deceased spouse that have not been dealt with
- Administering foreign assets (outside England and Wales)
- Trusts created by the deceased during their lifetime
- The administration of Trusts created by the Will of the deceased
- Dealing with and advising upon disputes between beneficiaries as to the distribution of assets
- Any dependency claims against the estate
- Detailed advice on complexities surrounding Inheritance Tax Relief
- Advice on the complexities surrounding Inheritance Relief claims
- Deed of Variation of the Estate
We shall be happy to discuss with you any such matters as they arise, and advise you on the necessary steps together with an estimate of the costs of these.