Tony Crocker

Tony Crocker is Director of IWC Estate Planning & Management Ltd. With over 15 years’ experience, he is knowledgeable and proficient in all matters regarding Probate, Will writing, Estate Planning and Inheritance tax avoidance. In addition, he has a wealth of experience in dealing with estate settlements and issues with the capital taxes office in the event of bereavement. As a member of the Society of Will Writers & Estate Planning Practitioners, he is widely respected within the field, having helped many people at difficult points in their lives through complex probate and tax issues. Tony Crocker

Minimising IHT on property based estates

Unfortunately, the government in recent years has sought to clamp down on more traditional ways of minimising Inheritance Tax (IHT) on estates which are comprised principally of property.
 
If you own more than one property outright, you may want to consider reducing the size of your estate through gifting or an increase in spending at this stage. However, this should be considered in light of the possibility of the need for nursing care for you and/or your spouse in the future.
 
Should you rent out at least one property and can spare the revenue originally received, you could perhaps gift that property to a beneficiary or place it into a trust to remove it from your estate.
 
If the income is still needed however, you might consider selling the property and investing the monies received from the sale into a discounted gift trust.
 
Bear in mind however, that Capital Gains Tax will still fall due on either the gifting or the sale of a property and that, should you choose to gift it, it will only be exempt from IHT if you live for at least another seven years.
 
Remortgaging your property to release funds for gifting is usually not recommended, as guidelines regarding this are extremely tight and more money could be lost than gained by following this course of action.
 
If you suspect that a considerable IHT bill will fall due on your main residence after your death, you may be advised to invest in a whole of life assurance policy, written in trust. In this way, you have provided funds to pay for the bill in advance, therefore protecting your beneficiaries from any undue financial burden and stress.

Tips to reduce your IHT liability

Although the government is taking steps to crack down on tax avoidance schemes in a very public way, there are still methods of helping to reduce your IHT liability.
 
Transfer your nil rate band
 
Married couples and civil partners can transfer their nil rate band on death to the surviving person, if it is not used. With the current nil rate band standing at £325,000, this means that IHT will only become liable if their joint assets exceed £650,000.
 
Life assurance policies written in trust
 
By having your life assurance policy written in trust, you can ensure that the proceeds from the policy do not form part of your final, taxable estate but instead go directly to your beneficiaries.
 
Pensions on death
 
If you have a civil partner or spouse, monies which are received directly from a pension on death should be put into trust to ensure that they remain exempt from IHT, rather than directly to the surviving partner who would then be taxed on the proceeds.
 
Government reliefs
 
There are a number of reliefs available which could help to reduce or minimise the IHT liability on your estate. Reduce the value of your estate whenever possible through increased spending and gifting up to £3000 per annum. Provided you live for at least another seven years after you have made a gift, then no IHT will fall due on that particular asset. Remember too that parents can make wedding gifts of up to £5000 per child and grandparents can give up to £2,500.

What should be included in a Will?

A sad case was highlighted recently, whereby a young mum of three was still to be buried a year after her death, due to a delay brought about by arguments about where she was to be laid to rest.
 
Although she had been responsible and had a Will prepared, it did not state her preferred location of burial. Then, in the event of her death, her two executors and family could not agree on this detail, leading to costly court proceedings.
 
Born in Bristol, the woman had lived most of her life in London and it was for this reason, the camp comprising of her executors, friends and family were divided on where she would choose to be interred.
 
Finally, after a year of expensive legal wrangling, her body was moved to the Bristol area where, it is anticipated, she will be buried near to her late sister.
Unfortunately, her estate, thought to be worth several hundred thousand pounds, is still to be settled following other complications.

The role of executor – what do I do when money from the estate is released?

As an executor, it is your responsibility to take over the finances of the deceased person and notify creditors and relevant financial institutions that you are handling the distribution of the estate, once you have applied for Grant of Probate.
 
Once the probate process has ensured that money from the estate has been released, you must then settle all outstanding debts before distributing the balance of the funds as outlined in the deceased’s Will or according to the rules of intestacy.
 
Remember that outstanding debt does not just mean the balance owing to individual creditors. The relevant tax return forms need to be completed and submitted to HMRC so that any Capital Gains tax and Inheritance Tax can be calculated.
 
As the executor, you must ensure that all outstanding tax is paid and bills are settled before you can begin to distribute any assets or money from the estate. Failure to carry out the probate process accordingly, in line with English law, can bring about severe personal consequences. It is therefore always advised in all except the very smallest of estates, that the advice of a probate specialist is sought.

What is the probate process in Florida?

The probate process in Florida can take up to two years to complete.
 
It is advisable, if you have a holiday home or are a British expat in Florida, to ensure that any Wills produced cover both UK and Florida legislation and all your assets. All official documents connected to the death of the person, need to be officially recognised and validated by the State of Florida.  
 
The executors of the Will must apply to be formally recognised as personal representatives by the State if the deceased was classed as a Florida resident, whereas representatives of deceased non-residents must be close family members, or residents of Florida.
 
Normally, a British person will be taxed by the US only on the assets located in that country.  It is worth noting that the Nil Rate Band for non-US citizens is $60,000 (outstanding mortgages may not be deducted from the value of the estate), compared to $5 million for residents. 

What happens to the mortgage when my spouse dies?

If your mortgage is in joint names, then you are considered to be jointly responsible for the payment of that debt. So, if your partner dies and there is still a balance owing on the mortgage, you must see to it that the payments continue to be made.
 
Your partner or spouse may or may not dictate in their Will, that a portion of funds from the estate be allocated to paying off the mortgage.
 
If no Will has been made however, the estate will be passed into intestacy and there is no guarantee that funds will be made available to you as the joint person on the mortgage, to help you pay it.
 
There is often a false expectation with the surviving spouse, that all debts belonging to their deceased partner, including the mortgage, are written off in the event of their death. Be aware that this is not the case and see legal help from a probate specialist if necessary.

Wills published online will help family tree searches

The recent news, that around six million probate records dating from 1942 to 1966 have now been published online, is great news for those looking to research the family tree.
 
Of course great emphasis has been placed on information revealed by the Wills of the rich and famous including Florence Nightingale, Winston Churchill, Dylan Thomas and Georfe Formby. However, for the amateur researcher, this move could be the key to unlocking more of their family tree by revealing what their relatives left, and to whom.
 
Unfortunately, this 24 year span simply offers a shortcut to a limited aspect of each family tree, which can take months or even years to put together. 
For a faster, easier way of preparing a family tree, why not see the budget-friendly packages which research experts IWC Ltd offer?

What Are Non-Contentious Probate Fees?

If you have been appointed as an executor of a will and you are faced with dealing with probate, you may have heard the terms contentious and non-contentious probate fees.
 
Non-Contentious probate is defined as “non-contentious or common form probate business.” This means the business of obtaining probate and administration where there is no contention.
 
Non-Contentious probate fees should be fair and reasonable and take into account the complexity and skill required to deal with non-contentious work and also the sum of money involved, according the Law Society.
 
Basically this means that a solicitor is not allowed to charge you a ridiculous sum for straightforward matters, such as putting in an application for probate.
 
Many solicitors charge by the hour and it is not unusual to pay sums in excess of £300 per hour. Even those who don’t charge by the hour can charge hefty per task fees. With sums of £50 for a phone call and £100 for a letter and higher, costs can soon spiral out of control.
 
Some solicitors and banks charge based on a percentage of the estate value, therefore costs can be substantial. This is considered unfair when dealing with straightforward matters, for example forwarding documentation to the registry.
 
You can avoid this by making sure you choose a probate company who calculated their costs based on the amount of work involved. A fixed fee service will agree a fixed sum upfront which includes dealing with non-contentious probate matters. That way you know the exact costs and don’t have to worry that legal fees may spiral out of control.
 
In addition to the initial application for probate, non-contentious probate fees may include duplicate grant applications, deposit of wills, searches, copy documents, oaths and inspection of wills and determination of costs.
 
At a time when you are grieving, it can be difficult to get your head round all the legal jargon, let alone understand what you should be charged. 
 
Contact specialist practitioners at IWC to find out more about our fixed probate fees – for complete peace of mind.
 

Is it Wise to Apply for Letters of Administration Independently?

If you are faced with the burden of dealing with a loved ones finances when they have died intestate, you may be wondering if you should apply for letters of administration yourself.
 
While the initial application may seem straightforward, there are several factors to consider. For a start, if you will have to do a lot of legwork before you are able to apply for letters of administration. This will involve tracking down all your loved ones assets, finding out whether they are owed money and if they owe money to anyone else.
 
If the deceased’s financial affairs are not straightforward, this can create a lot of work for you. So it may be worth appointing a specialist probate service to apply for letters of administration for you and deal with the estate on your behalf.
 
Another concern is tax matters. If inheritance tax is due on your loved ones estate, some of it is payable immediately. This can be a huge worry but a specialist probate service will be able to handle this efficiently and accurately.
 
Even if the deceased’s financial affairs are straightforward, it can still take time from the initial application for letters of administration, to settling the estate. This can put significant pressure on you at a time when you are grieving the loss of someone close to you.
 
Many people who inherit money from a loved one simply have no idea of the timescales involved and it is common for them to put pressure on the person administering the estate. If you are concerned about this happening, you may want to appoint a professional to deal with everything on your behalf and take the pressure off you.
 
Though there is no will to be contested when someone dies intestate, some relatives may wish to appeal against the distribution of the estate. For example, if a relative or common law spouse lived with the deceased and relied on them financially, they may appeal. This will put a huge strain on you, and also on your relationship with them, so it may be wise to appoint an expert.
 
Another common problem is where children under the age of 18 are entitled to a proportion, or all of the estate. In this case it is important to appoint someone to administer the will on your behalf, and you should get legal advice immediately.

How Long Does It Take To Get Letters of Administration

How Long Does It Take To Get Letters of Administration

If a loved one has died intestate and you are legally entitled to administrate the will you may be wondering how long it all takes. From the initial application for letters of administration, it usually takes around 4-6 weeks before you receive the documents. This is just the start, after you receive the letters, which entitle you to access the deceased’s financial accounts you may have a lot of work ahead of you. If your loved one has left significant assets and their finances are not straightforward at all, administering the will could take years.
 
Whatever your situation, it is important to apply as quickly as possible. This may feel difficult when you are grieving the death of a loved one. But you don’t need to do it alone. A specialist probate service can administer the deceased’s estate on your behalf.
 
If you speak to them immediately, they will be able to advise you, offer you up-front fixed fee costs and deal with everything from applying for letter of administration, to distributing the proceeds of the estate.
 
If you decide to administer the estate yourself, there are several important things that you should know. If the estate is liable to inheritance tax, values of assets are taken at the time of death, not the time of sale. So it is important to get any property etc. valued as soon as possible. Form IHT 400 must be completed for inheritance tax purposes. This is similar to a tax return but much longer and if you are not familiar with completing tax returns, it would be wise to get professional advice.
 
Even if no inheritance tax is payable, you will need to complete tax form IHT 205 and send it directly to the Probate Registry.
 
If the deceased was living abroad at the time of death, this may make it more difficult to administer the estate and it would make sense to appoint a specialist to apply for letters of administration on your behalf and deal with the estate.
 
Also, if the deceased held shares in a variety of different companies, or their assets are difficult to track down, you may need specialist help.
 
A major problem when a loved one dies intestate is that the administrator may become resentful of their deceased relative for leaving them with a huge mess to sort out. This is a shame when you are trying to deal with the loss of your loved one, and if you have any doubts about dealing with administration at this difficult time, it would be wise to appoint a specialist probate service.
 
They will be able to apply for letters of administration on your behalf, and deal with every aspect of your loved ones estate, giving you time to grieve your loss.
 
 

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