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Matters to Consider Post Probate - Collecting in the assets

Once the executors have obtained the Grant of Probate you are able to proceed to the next, usually shorter stage. The Grant of Probate proves that you are entitled to access the deceased's money and to sell or otherwise dispose of their assets.

There are a number of useful letter templates on the Templates section which are relevant to collecting in the assets.

Financial institutions

You will know from your previous communications with banks, building societies and other financial institutions whether they need to see a copy of the Grant of Probate in order for them to forward monies to you. If you send a copy of the Grant of Probate be sure to request that they return it to you. If the institution also needs closure forms to be completed they will have sent these to you when they replied to your request for valuation.

All money received should be paid in to your executor's bank account. Any account balances forwarded to you by cheque may be made out to "The Executors of ...". If you don't have an executors' account these cheques may need to be returned with a request for them to be re-written in your name. If you have opened a second, interest bearing account then money can be transferred to this once cheques have cleared. It is important that you keep a careful record of all money received. Any interest earned after the death should be recorded.

You may be required to complete a tax return at the end of the administration period, but in any case you will need to tell the beneficiaries. A non-taxpayer can reclaim the tax but a higher rate taxpayer may owe more.

Stocks and shares

Depending on the share then you may be able to sell or transfer it via the company issuing the shares or the share registrar. For many shares, however, you will need to use a stockbroker. If necessary you can easily open an account online but bear in mind that most brokers will make account charges on inactive accounts, so you should remember to close the account when the shares are sold.

Property

If the deceased owned a property you may have instructed an estate agent to market it before obtaining the Grant of Probate. You should use a solicitor for the conveyancing and if the property market is falling you should make every attempt to sell it quickly in case you make yourself liable to claims of causing estate losses (see the section on executor liabilities). If you are using a solicitor to help with any aspect of the administration you should make sure you get a competitive quote from them, or use a different solicitor for the conveyancing. Conveyancing tends to be much more competitive than probate work. You do not want to pay probate rates to sell a house.

If the property has risen in value significantly there may be Capital Gains Tax to pay on the sale. Executors of an estate have their own Capital Gains Tax allowance for the tax year in which the deceased died and in each of the following two years. If a property is thought to have risen, say, by £20,000 since the date of death, there will be CGT to pay if the property is sold in the tax year the deceased died. By arranging for completion to take place in the following tax year the payment date for the tax can be deferred.

In more extreme cases, where a property has risen, for instance, by £50,000, it is possible to minimise the Capital Gains tax owed by transferring the property jointly to the beneficiaries before selling it. The transfer will be deemed to have been at probate value and each beneficiary will be able to apply their own Capital Gains Allowances when it is sold. A solicitor's involvement is highly recommended.

Assets sold at a loss

If an estate includes quoted securities which are sold within 12 months after death at a lower value than the value at the date of death the executor can make a claim for the total sales proceeds to be substituted for the value at death, which will result in a lower value for Inheritance Tax . This also applies if shares are cancelled or suspended within 12 months of death. However, this option is not available selectively as all sales must be taken into account including those made at a profit so the executor needs to exercise care. A similar claim is available for any land or property held by the estate that is sold by the executor or personal representatives at a loss within four years of the death.

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