The Difference Between Grant of Probate and Letters of Administration

What’s the Difference Between Grant of Probate and Letters of Administration?

There is some confusion and misunderstanding about the probate process, so here we will explain the difference between a grant of probate and letters of administration.

When an individual dies their assets including any property that they own, their bank accounts, and all personal possessions that they leave behind are known as their estate. To be able to deal with the deceased’s estate it will be necessary to obtain legal authority from the Probate Registry.

This legal authority that is issued by the Probate Registry is called a Grant of Representation which will allow whoever is dealing with the estate to close bank accounts, cash in investments and to sell or transfer property. The Grant of Representation comes in two different forms – either a Grant of Probate where an individual dies with a valid will or what is known as Letters of Administration, if the individual dies without a will.

Grant of Probate

A Grant of Probate will only be issued to the executors that are named in the Will. Once the executors have got the Grant of Probate they have the legal power to deal with the estate, and they can start to cash in assets and transfer them to the beneficiaries named in the Will. Some financial institutions may need to see a copy of the Will and the Grant of Probate before they release any funds as they need to be sure that the Will is valid and the named executors are the correct people responsible for dealing with the estate.

The Grant of Probate is legal confirmation that the Will is valid. Once the Grant has been issued, it means that the Will has been officially registered and the executors named in the Will are the only ones who have authority to deal with the estate.

Probate-Form
Official Probate Form

Letters of Administration

Letters of Administration are similar to a Grant of Probate, but are issued instead to the next of kin of an individual who dies without a Will. Letters of Administration is the document issued by the Probate Registry to the administrators authorising them to deal with the estate. The authority to do this is not automatic, and it may be necessary to apply to the Court for Letters of Administration to confirm an entitlement to manage an estate, as there are certain financial institutions that require this.

This can cause problems if, for example, family members cannot agree who would be the best person to deal with the estate. Where there are such disputes, it is normal practise for the Court to get involved, and the financial costs involved in this can soon mount up.

Letters of Administration might also be issued where there is a valid Will, but the Executor named in the Will is not applying for a Grant of Probate. This could be because they do not want to act as executor, are not capable of doing so, or they have already passed away. Where this is the case, it is common for one of the main beneficiaries in the Will to apply for Letters of Administration instead.

Probate Registries

The offices that issue Grants of Probate and Letters of Administration are known as Probate Registries, and there are twelve such offices in England and Wales. The probate registry is responsible for making sure that the will is valid and the applicant is entitled to handle the estate of the deceased.

A probate registry decides the legal validity of a deceased person’s Will and grants its approval, also known as granting probate, to the executors. This acts as proof that the executors have the authority they need to handle the estate of the deceased person.

When making a Will, you should think long and hard about the appointment of your executors. An executor needs to have the capability of managing a potentially complex process that can take a long time to complete.

Over a million people overcharged for Power of Attorneys

Over a million people have been overcharged for registering Power of Attorneys in the last few years.

If you paid to register a Power of Attorney in England or Wales between 1st April 2013 and 31st March 2017, then you are entitled to a refund of up to £54 as you were quite simply overcharged.

There is an application fee to register a Power of Attorney, which is set by the Ministry of Justice and paid to the Office of the Public Guardian. Between 2013 and 2017, the operating costs of the Office of the Public Guardian decreased, but the Power of Attorney application fee stayed the same for four whole years! As the fee is supposed to cover just the operating costs, the Government will now repay the difference between what applicants paid and what they should have paid, plus a small amount of interest; but only if they apply for the refund – the refund will not happen automatically.

The Ministry of Justice has confirmed that 1.7 million applications are affected. It’s not clear exactly how many people are owed a refund, as many people will have registered both types of Power of Attorney, but it is certain that over a million people are affected, and are due a refund, and with the average refund of £40, there is over £40 million waiting to be refunded.

LPA-refund
Lasting Power Of Attorney Overcharge Scandal

You can make your own judgement as to the lack of efficiency here, and take your own view on the scandal of over one million people being overcharged, and why they are not being automatically refunded.

A Lasting Power of Attorney (LPA) is a legal document which allows you, while you still have the mental capacity to do so, to nominate a trusted friend or relative to look after your affairs if or when you lose your mental capacity. There are two types of Power of Attorney, one for health and welfare, and one for property and financial affairs. Some people will have registered both types of Power of Attorney and so can thus claim a refund of up to £108.

How much you can reclaim depends on when you paid for the Power of Attorneys which is calculated on a sliding scale for all applications from April 2013 to March 2017.

You can make a claim if you were the person who made the Power of Attorney or you are the person appointed in the LPA; with the refund being paid to the person who made the LPA. You can claim a refund even if the Power of Attorney has been used.

You can claim a refund online via the gov.uk website, or by phoning the Office of the Public Guardian’s helpline on 0300 456 0300. You don’t need the Power of Attorney document itself, but you will need the person’s name, address, date of birth, bank account number and sort code and the name of one of the people mentioned on the LPA.

Jenny Chase, wills specialist at Quick Will comments “If you did register an LPA during the period April 2013 to March 2017, we would hope that if you used a solicitor, a will writer or another organisation to help you complete the forms (for a fee) that they have been in touch with you to let you know you are entitled to a refund. If they haven’t been in touch, perhaps you should consider whether they have your best interests at heart, and whether you should use them for anything else in the future.”

Either way, do apply for a refund – you are entitled to it.

Wills and Probate Glossary

Wills and Probate Glossary

There are many terms that are used in relation to Wills and Probate, and here we explain some of these commonly used wills and probates terms in plain English.

legal-glossary
Legal Glossary
  • Administrator
  • The person who deals with the estate of a person who has died intestate (without a Will).

  • Apportionment
  • The proportionate division of a deceased’s estate between certain beneficiaries.

  • Assets
  • Property, money and other belongings owned by the deceased.

  • Attorney
  • A person, typically a lawyer, but not always, who is appointed to act for another in business or legal matters on their behalf.

  • Attestation
  • Confirmation or verification. It is often used as a term when witnessing a signature.

  • Beneficiary
  • Anyone or any organisation that is entitled to a share of the estate of the deceased.

  • Bequest
  • Any gift left in a Will that is not land or buildings.

  • Capital Gains Tax (CGT)
  • This is a tax on the profit made when selling an asset.

  • Chattels
  • Any movable personal property or belongings that is not used for business. Examples of personal chattels would be ornaments, jewellery, furniture, clothes and so on.

  • Codicil
  • An addition or change made to a Will, for example, to increase a cash legacy.

  • Common Law Spouse
  • There is no such thing as a common law spouse in law.

  • Court of Protection
  • The Court of Protection in English law is a superior court that has jurisdiction over the property, financial affairs and personal welfare of people who lack the mental capacity to make decisions for themselves.

  • Discretionary Trust
  • A trust where the trustee has the full power to decide when and to which beneficiaries are to receive their capital.

  • Domicile
  • Domicile is a concept of general law. Domicile is distinct from nationality or residence. Broadly speaking your domicile is the country where you have your permanent home, and you can only have one domicile at any given time.

  • Estate
  • All the possessions of the person who has died, including all property, cars, investments, money and other belongings.

  • Executors
  • The persons or organisations appointed in the Will to administer an estate.

  • Gift
  • A transfer from one person to another without fair compensation in return. A legacy left to others in a Will.

  • Grant of Probate
  • The document issued by the Probate Registry to the executors to authorise them to deal with the estate.

  • Grant of Representation
  • The grant is a legal document issued by a court which confirms that the executor has the authority to deal with the deceased person’s assets. This document must thus be obtained before the executors can start closing accounts and liquidating assets.

  • Guardian
  • The person appointed by a parent or a court to have parental responsibility for a child under the age of 18 years.

  • Inheritance (Provision for Family and Dependants) Act 1975
  • This is the act that allows people to bring a claim for inadequate provision under the terms of a Will or intestacy. The act makes provision for empowering the court to make orders for provision for the spouse, former spouse, child, child of the family or dependant of that person.

  • Inheritance Tax (IHT)
  • The tax that is to be paid when the total estate of a person who has died is more than the current inheritance tax threshold.

  • Intestacy
  • The name for the situation which arises when someone dies without having made a legally valid Will. Their estate is then distributed according to rules laid down in law governing intestacy.

  • Insolvency
  • When there is a shortfall of funds to meet all liabilities at the time they are due.

  • Joint Tenancy
  • Property that is owned by two or more people in equal shares. Joint tenants are usually husband and wife and in the event of the death of the first person, the share of the property they owned would pass automatically to the surviving owner and would do so outside the terms of any Will.

  • Last Will and Testament
  • A legal document that lays out the way a person wishes to have their estate distributed upon their death.

  • Lasting Power of Attorney (LPA)
  • A Lasting Power of Attorney can relate to someone’s property and affairs or their personal welfare. Their purpose is to meet the needs of those who can see a time when they will not be able to look after their own personal, financial or business affairs. The LPA allows for appropriate arrangements for family members or trusted friends to be authorised to make decisions on their behalf.

  • Laws of Intestacy
  • The Laws of Intestacy dictate how an estate is distributed should a person die without leaving a legally valid Will.

  • Leasehold
  • A form of property tenure where a person buys the right to occupy land or a building for a given length of time. Ownership of the property will pass to the landlord when the lease comes to an end.

  • Legacy
  • A gift of money (usually a specific amount) left to someone in a Will.

  • Letter Of Intent
  • An appendix to a Will detailing specific wishes not covered by law. This would typically include preferred funeral arrangements.

  • Letters Of Administration
  • Letters of Administration are granted by a probate registry to appoint appropriate people to deal with a deceased person’s estate where property will pass under Intestacy Rules or where there are no executors living (and willing and able to act) having been validly appointed under the deceased’s Will.

  • Liabilities
  • The debts that need to be settled by the estate following the death of the deceased.

  • Memorandum of Wishes
  • Where a gift in a Will is coupled with a (non-binding) wish that it is to be distributed in accordance with wishes set out separately elsewhere.

  • Minor
  • A person under the age of 18.

  • Next of Kin
  • The nearest blood relative of the deceased. When a person dies intestate the next of kin are the people entitled to the estate, in accordance with the Rules of Intestacy.

  • Office of the Public Guardian (OPG)
  • The Office of the Public Guardian is a government body that protects the private assets and supervises the financial affairs of people who lack mental capacity for making decisions. The OPG works closely with the Court of Protection.

  • Parental Responsibility
  • The rights and responsibilities that a parent has towards a child and their property

  • Pecuniary Legacy
  • A gift of a fixed sum of money.

  • Post Mortem
  • A medical examination of the body to determine the cause of death.

  • Potentially Exempt Transfer
  • A gift made during one’s lifetime that is exempt from Inheritance Tax if the donor lives for seven years after making the gift.

  • Power of Attorney
  • Authorisation to act on someone else’s behalf.

  • Predeceased
  • Someone who dies before the person who has made the Will.

  • Probate
  • Probate is the official process that gives the executors of a Will the right to deal with the deceased’s assets and property. It acts as proof that the executors have the authority they need to handle the estate of the deceased person. This legal procedure must be undertaken to establish that a Will is genuine and valid.

  • Probate Registry
  • A court within the family division of the High Court, that deals with probate matters. The probate registry is responsible for making sure that the Will is valid and the applicant is entitled to handle the estate of the deceased.

  • Residuary Estate
  • What is left of the estate after all liabilities and expenses have been paid.

  • Revocation
  • The term used when the testator decides to legally cancel their Will completely and invalidate the previous Will.

  • Tenant for Life
  • Property that is owned by two or more people. Joint tenants are usually husband and wife and in the event of the death of one tenant, the other automatically becomes the owner of the whole property. In these situations it is not possible for a tenant to make a gift of their share of the property to someone else as it is not theirs to give.

  • Tenants in Common
  • Property that is owned jointly but each joint owner has a distinct share forming part of their estate on death which does not pass automatically to the surviving tenant.

  • Testamentary Expenses
  • The costs of obtaining the Grant of Probate or Letters of Administration and of administering the estate.

  • Testator
  • The person who sets out his wishes and requests as to how their estate should be divided in the form of a Will.

  • Trust
  • An arrangement set up by Will or deed with the trustees being appointed and given money or assets to hold and manage on behalf of the beneficiaries.

  • Trustee
  • Someone who is given the legal responsibility to hold any assets until nominated beneficiaries meet certain criteria set out in the deceased’s Will e.g. until a beneficiary reaches the age of 21. Trustees normally have powers to distribute monies and have full power to sell and invest. Trustees have duties to be loyal, prudent, impartial and to inform the beneficiaries of the trust.

  • Will
  • A legally binding set of instructions indicating how someone wishes to dispose of their assets upon their death.

  • Witnesses
  • The persons who must be present to see the testator sign the Will. They must also sign the Will themselves and should not be beneficiaries of the Will.

    We hope this Wills and Probate glossary guide has been useful. If you want to find out more you can check this comprehensive Wills and Probate Glossary. Meantime, we hope this guide will help you create a Will.

Online Probate Service

The Probate Service has said that it is now accepting personal applications online, providing that the applications meet certain criteria.

If you are the executor of an estate in England and Wales, you can now apply online for probate using a new digital service launched by HM Courts and Tribunal Services. At first the service will only be available to personal applications from executors who are acting alone and have a copy of the original Will. If the Will has been updated with a codicil, the executor will still need to submit a paper application.

online probate application
Probate Applications Now Online

The Probate Service has said the online application form is easier to understand, but it has said applicants will need to provide supporting documents, including the original will and two photocopies, the death certificate and the associated inheritance tax forms.

How does the online probate service work?

The online probate service will allow an executor to submit details online to obtain a grant of probate. However, it is not a fully digital service just yet, as there is still a need to send through copies of the necessary paperwork, including copies of the Will and the Death Certificate. Applying online will of course save executors time, and there will no longer be a need to visit the probate office or a solicitor’s office, and all the hassle that entails, to swear an oath.

How much does it cost to apply for probate?

When you apply for a grant of probate, you will need to pay a fee, which is currently set at £215. However, if the estate is worth less than £5,000 this fee is waived. With the new online probate service, you will be able to pay the probate fees online when you make your application. In time, it is expected to be cheaper to apply for probate online than via the post, and of course there will be no need to pay additional solicitors’ fees.

online-probate-application
Applying for probate online

Online services for more complex cases will be launched later this year, with The Probate Service saying: “We are looking to enhance this in the future, potentially through links with other departments to gather this information automatically as part of the process.”

Jenny Chase one of the experts at leading UK online will writing company Quick Will says: “This will be a relief to those who apply for probate after a loved one dies. There will now be less red tape and anguish as people will no longer have to swear an oath in front of a solicitor. It is great news that this online probate service is now online, and it is yet another example of how the will writing industry is moving online.”