Letters of Administration

Letters of Administration

Before probate can be granted, certain things must happen – specific documents must be obtained. One of these documents is the letters of administration. This is the document that allows the applicant to have control over the assets of the deceased. Although this is similar to a Grant of Probate, the letters of administration are used in situations when the deceased died intestate (without a will). It can also be used if there is a will but it is not deemed to be valid, if the executors do not wish to carry out their duties, or if there are no named executors.

Letters of Administration 300x199 Letters of Administration

In order to apply for the letters of administration, a PA1 form needs to be completed and this, along with payment and either a IHT205 or IHT400 (for inheritance tax), should be sent to the probate registry. Once this has been received, the administrator will need to attend an interview. The interview will require the administrator to swear an oath that all the information provided is accurate.

Not everyone can apply for letter of administration. The intestacy rules need to be looked into to see who has the right to apply. In most cases this will be the next of kin, and there is an order to follow. It starts with the spouse or civil partner (but not common law partners), and then moves onto any adult children. Next in line is the parents, siblings, grandparents, and uncles and aunts. The rules are that they must be over 18, but if the person who is entitled to the estate is under 18, there must be two people to apply for the letters of administration. 

Do I need a probate specialist?

Do I need a probate specialist?

Losing a loved one is often a dreadful experience. But however harsh or unfair it may seem, life goes on: children have to go to school, shopping has to be done, bills have to be paid and the affairs of the deceased have to be wound up.

Settling the deceased's affairs can be a complicated process. Even a straightforward estate will usually involve having to close bank accounts, claim on life insurance policies, settling the deceased's debts and distributing the estate to the lawful beneficiaries.  This doesn't happen automatically, and  someone has to obtain lawful authority to deal with the deceased's estate.

In England and Wales, this will mean going through a process known as probate. The procedures are different in Scotland, where the equivalent process is called confirmation.

Probate may not be required in the case of smaller estates – i.e. under £5000. In this instance, banks and other financial institutions may release funds belonging to the deceased on presentation of a death certificate. Bear in mind though, that even if probate is unnecessary, the deceased's estate must be distributed in accordance with his or her will or – if there is no will – in terms of the rules governing intestate succession.

If the deceased left a will, the person nominated in it as executor should apply to the Probate Registry for a Grant of Representation. This gives the executor legal authority to settle and distribute the deceased's estate.

If there is no will, or a will but no executor, then the process is a little more complicated. Application will have to be made by the deceased's next of kin (as defined by the law) for Letters of Administration to be granted.  There may be more than one person entitled to apply for Letters of Administration. 

Obtaining professional help to obtain probate and administer an estate eases the burden for the executor and should ensure that the process runs as quickly and efficiently as possible. It can also help to shield the executor or administrator from family issues that can sometimes arise over the handling and distribution of the deceased's estate.

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Probate – insuring assets

As an executor, you may not realise the importance of having the deceased’s valuable assets insured, until such time as they have been disposed of or distributed.

Should their uninsured home suffer flooding whilst the probate process is underway for example, you could be held personally liable.

Always check that any insurance policies remain in place for at least six months after the person’s death and should probate continue after this time, check periodically that everything is still current.

Don’t allow valuables to remain on full view of visitors or passers by, when public notification of the death has been given.  Similarly, ensure that their home continues to look occupied and strengthen security measures if necessary.

Powers Granted in Letters of Administration

Powers Granted in Letters of Administration

There are a number of reasons in cases of probate for individuals to seek Letters of Administration.  A Grant of Letters of Administration may be requested by the next-of-kin in a case where the deceased has died intestate (without a will). This Grant can also be applied for if the executor named in the will has passed away, or is unwilling or unable to act as executor.
 
Whatever the circumstances, by the Grant of Letters of Administration the court officially appoints an administrator to handle the deceased estate. It gives the person who receives this appointment exactly the same powers as an executor that has been named in a will.
 
Through the Grant of Letters of Administration an individual can sell, mortgage, or otherwise dispose of the assets of the deceased.  An administrator cannot make any profit out of the estate for himself, other than what he might obtain as a beneficiary.
 
Up to 4 administrators may be appointed to execute an estate and in addition to the powers they are given there are certain duties that they have to perform. These include securing all assets and taking possession of these where ever possible. An administrator should also take out insurance to protect the value of any assets.
 
If there are any estate liabilities and taxes, such as inheritance tax, the administrator needs to arrange for these to be paid. When all of the debts on an estate have been settled, the administrator must distribute the estate in accordance with the laws of intestacy.
 
If you have any questions with regards to Letters of Administration call our free probate advice line on 0800 612 6105, open until 10pm, 7 days a week.

Letters of administration in brief

When a person dies without a Will, or if the will that they have left has been deemed invalid, they are described as being 'Intestate.' In this situation a relative, or other person, must apply for Letters of Administration to deal with the deceased's affairs.
 
Dealing with the estate of someone who has died intestate can be a complicated process. The level of difficulty depends greatly on the amount of money, assets, and property that the estate contains. Further complications are caused by the number of beneficiaries that may have a claim to the estate. Generally speaking the more people that are involved, the more complicated it is to sort out, particularly if it is difficult to find some of the beneficiaries.
 
The first step in the process is obtaining the right to administer the estate. In normal circumstances, when the deceased has left a will, there is a named executor who can obtain a Grant of Probate enabling them to administer the estate. In cases of intestacy there is no executor. The task of administering the estate will then fall to a relative of the deceased, who must apply for Letters of Administration. This person is usually a spouse, or child. An adopted child may make the application, but not a step child. The applicant must be over 18 years of age.
 
If the deceased is survived by a parent they are the next in line for the responsibility. After this the application can be made by siblings, then grandparents, then uncles or aunts. Other relatives that may apply for Letters of Administration are nieces, nephews and cousins. In cases where there are no surviving relatives the state will then make the application.
 
Once the applicant has established the right to apply for the grant of Letters of Administration the next step is to complete the application form. If the value of the estate is above £325,000 then the applicant will also need to complete the Inheritance Tax forms at the same time. Following this the applicant will be required to attend an interview at the Probate Registry to confirm the details in the application. The Letters of Administration will then be delivered by post shortly afterwards.
 
If you would like to find out more information you can call our confidential free phone 7 days a week until 10pm on 0800 612 6105

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.
 
 

Letters of Administration in Scotland

We post an awful lot on our blog about applications for letters of administration in England, Wales and Northern Ireland and would like to offer the same help and information for our Scottish readers.
 
Scotland has a separate judicial system to the rest of the UK, this means there are substantial differences between probate in Scotland and in the rest of the UK. Probate is upheld by the Scottish Courts; laws, terminology and processes are very different.
 
While the process of applying for probate (confirmation) when there is a valid will may be quite similar to that of England and Wales, this is not so for cases of intestacy. 
 
Who should apply for Letters of Administration?
 
The Succession (Scotland) Act 1964 determines, who can apply to administer the estate, who will inherit and how much they are entitled to inherit. A personal representative for the deceased will be appointed by the Sheriff Court in the following order of priority;
a person who is entitled to inherit
deceased’s next of kin
estate creditors
the procurator fiscal
 
How to Apply
 
First you must make an inventory of assets and value the estate. Estates valued at less than £36,000 can go through a simplified version of the confirmation process. You must contact the Sheriff Court nearest to where the deceased was domiciled at the date of death and arrange an interview.
 
For estates that exceed £36,000, an inventory form C1 and relative form C5 must be completed, and sent with the relevant documentation to the Sheriff Court. If inheritance tax will be due, a complete tax return must be prepared (form IHT400) and sent to HMRC.
 
Before obtaining confirmation, the representative must obtain a Bond of Caution. This is a guarantee made by an insurance company that the executor will distribute the estate in accordance with Scottish intestacy laws.
 
What Happens Next?
 
Provided there are no complications, you will be granted letters of administration. The document can be used to obtain access to funds, act on behalf of the deceased and wind up the estate. This involves informing relevant persons, maintaining a set of accounts, collecting monies owed, paying creditors, correspondence with beneficiaries, the sale of assets and ultimately distributing assets in accordance with intestacy law.

Who will Inherit and How Much?
 
Scottish Succession law sets out how intestate estates should be divided. Inheritance law states that certain beneficiaries have `rights` to claim; these are known as the Rights of Succession. These are briefly summarised as –
 
Prior Rights – The entitlement of the surviving spouse or civil partner.
Legal Rights – After the satisfaction of prior rights, the surviving spouse and children of the deceased are entitled to claim legal rights to the moveable estate.
The Free Estate – Is the remainder, after legal rights and expenses which is divided between close relatives.

Why Are Letters of Administration Needed?

Letters of Administration are needed when a loved one dies intestate. They are letters which give the person administering the deceased’s estate permission to access their finances.

Does Everyone Need Letters of Administration When a Loved One Dies?
 
There are certain circumstances where Letters of Administration are not needed to access the deceased’s finances. For example, if your loved one has less than £5000 left in the bank after paying funeral expenses, you may not need the document to access their money. Some banks have increased this sum to £10,000 so you will need to check with the deceased’s bank.
 
Also, if you are married to a deceased and all their assets were held in joint names with you, you may not need to apply for a grant, as the financial institutions concerned should be able to transfer the assets into your name.

What If These Cases Don’t Apply to You?
 
If neither of these cases are relevant to you, and your loved one didn’t leave a will, you will need to find out who is legally entitled to apply for the letters. Then before they actually apply they will need to find out where all the deceased assets are held and work out who is entitled to receive them. The law has clear guidelines on who will benefit when someone dies intestate and in what order. But it may become complicated if someone appeals. For example, a common law wife, or another family member may appeal if she was financially dependent on the deceased.
 
An intestate death can be far more complicated than dealing with the estate when a will was left, and it could take years. Once you have received a grant of letters of administration you will need to pay any money owed by the deceased, and collect in any money owing to them, as well as liquidising their assets, calculating taxes and ensuring the estate is distributed correctly to those who are entitled to benefit.
 
Because this can be such a long, time consuming and drawn out process, you may want to appoint an expert probate service to deal with it on your behalf. Your best bet is to use a probate service that can offer you a fixed fee, that way the proceeds of the estate will not be eaten up by a huge legal bill.

Who Is Entitled To Apply For Letters of Administration?

If a loved one has died intestate, you may have learned that you will need to apply for Letters of Administration to administer your loved ones estate. Letters of Administration are similar to Grants of Probate. Both are applications for permission to access the deceased’s finances and deal with the estate.
 
The difference is, the executors of the will would apply for Grants of Probate. But when someone dies intestate there is no will, so an Administrator would deal with the estate as opposed to an Executor and the law has specific rules on who is eligible to administer the will of the deceased.
 
Depending on the relatives left behind, the deceased’s estate will be dealt with by one of the following family members, in this exact order: Husband, wife or civil partner, but not common law partner, adult children including adopted children but not step-children, parents, brothers and sisters or their children, grandparents, aunts and uncles but not their spouses.
 
Once you have established which relative is entitled to apply for Letters of Administration, you will need to decide whether they are going to deal with the estate themselves at this terrible time of grief, or if they are going to use a specialist probate service to act on their behalf.
 
Although applying for the initial Letters of Administration is quite straightforward, you will need to gather a lot of information about the deceased’s finances, before you fill out the application. Because there is no will to guide you on this, it can be a complicated affair in itself. So if your loved one has left significant assets it may be better to appoint a specialist service to administer the estate on your behalf from the outset.
 
It is difficult to focus on financial matters when you are grieving, and if children under the age of 18 have been left behind, or the deceased owns shares, businesses, land or property, dealing with an intestate will can become extremely complicated. Plus it can drag on for years, so it makes sense to use a specialist probate service to speed things up, especially if relatives left behind were financially independent on the deceased.
 
Another good reason for using a specialist service to apply for Letters of Administration on your behalf is taxes. The law requires that taxes are paid after death, not once the estate has been dealt with but a specialist service will know ways to get around this.
 
It is important that the relative responsible for administering the estate is aware of all these issues before they apply for decide whether to administer the estate themselves.

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