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IHT  •  Personal tax  •  probate  •  Probate and Inheritance Tax

Can accountants or tax advisers undertake probate work? And what’s the benefit of this?

By Lesley Stalker on 24 August, 2016

This is something we are asked a lot and the answer is definitely ‘yes’; accountants or tax advisors can undertake probate work if they are suitably qualified. These are some of the questions we get asked all the time:

 

What is probate? What does it involve?

When a person dies, generally speaking, a lot of paperwork is required. Probate is the administrative process that needs to be undertaken by the executors of a deceased’s estate. It gives the person designated with responsibility for managing the estate a legal right to distribute assets within the estate according to the deceased’s wishes, and part of this will be the completion of any tax calculations and arranging payment of any tax due.

 

Do I need to employ a specialist for probate?

It is possible for a layperson to complete probate with some guidance, but because of the complexity of the processes and the time required, it tends to be handed over to a professional. In addition, many people find it too much of a strain to undertake this work when added to the stress of dealing with bereavement.

 

What steps are involved to obtain probate?

In order to apply for probate it is necessary to firstly ascertain the inheritance tax position. This involves obtaining details of all the deceased’s assets on the date of their death, checking the position based on the deceased’s will (or the intestacy provisions if there is no will) and calculating any inheritance tax liability. Only once this has been done can the probate application be fully completed.

It will also be necessary to prepare a tax return for the period to the date of death, in order to calculate, pay and deduct from the value of the estate any outstanding tax liabilities.

Only once probate has been granted can the estate be distributed in accordance with the deceased’s wishes in their will, or if there is no will, in accordance with the intestacy provisions.

There will be a period of time which elapses between the date of death and the date on which the estate can be distributed. During this time the estate assets may produce income, such as bank interest, dividends, rental income etc. In this case it will be necessary to prepare estate accounts and a tax return for the period of administration, and to pay out of the estate assets any tax liabilities which arise.

 

Do you need legal advice?

There are circumstances in which legal advice is required to obtain probate; such as where the validity of the will is in doubt; the intestacy provisions prove to be relevant and complex in the specific circumstances; a will was made but some dependants have been excluded and wish to make a claim; an estate is either insolvent or there are doubts about the solvency, to name but a few.

 

What are the benefits of having your accountant or tax advisor obtain probate?

Given the type of work involved, there can be a number of practical and financial benefits to using an appropriately qualified tax advisor or accountant. The first of these is simplicity; they may have a good understanding of the deceased’s assets and tax liabilities already and this enables the entire process to be dealt with quickly and without the necessity to involve multiple people. Secondly, much of the work involved is that which is familiar to an accountant or tax advisor; the production of figures such as accounts, assets, liabilities and tax calculations. In addition, by using an experienced tax advisor you can take the opportunity to undertake inheritance tax planning for the future.

 

Can RJP help you to obtain probate?

Yes. RJP LLP is licensed by the Institute of Chartered Accountants in England and Wales to carry out the reserved legal activity of non-contentious probate in England and Wales. We offer a full probate service for clients and can help you by preparing the necessary inheritance tax returns and calculations and obtaining the Grant of Probate.

 

Learn more about probate and inheritance tax planning

There are a number of tax planning strategies which can reduce the value of an estate for inheritance tax purposes and which are not considered to be aggressive by HMRC. For more information about these, read our previous blogs with tips on how to minimise inheritance tax.

If you would like advice about probate services or want to discuss inheritance tax planning, please contact Lesley Stalker by emailing las@rjp.co.uk.

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There are many benefits to asking your accountant to handle probate

Did you know RJP LLP are licensed by the ICAEW to offer a full probate service.

This can save you time and money, plus we can advise on matters related to inheritance tax at the same time.