Five common Estate Administration Mistakes
30 July 2024 | Wills, Trust & Probate |
Errors in administrating an Estate following the death of a loved one can have serious legal and financial implications. The most common estate administration mistakes are:-
1. Not understanding the provisions contained in the Will.
Sometimes legal jargon, Codicils and general unclear instructions together with discrepancies can be open to interpretation. These can and may differ from what the deceased may have told their relatives before their death. This can obviously create confusion and if there is any ambiguity, it could lead to errors in distributing the estate correctly which means potentially a costly dispute. This is why it is advisable for everyone to take good and proper legal advice and have the estate administered by a professional like Fishers.
2. Applying for Probate
Although there is no statutory time frame on applying for probate, Inheritance Tax payments are time limited. If the estate is subject to Inheritance Tax, an Executor can incur financial penalties from HMRC. In addition, not making a swift application for Probate the Executor will not have the legal authority to deal with the deceased affairs causing delays in distribution, often to family members who put on pressure. Although applications can be made direct delays can occur if the full information isn’t provided and mistakes are made on the forms.
3. Executors must keep everything recorded in writing
This means retaining copies of all completed forms and even write down the conversations from a telephone call. An Executor or Personal Representative could be liable if they haven’t kept accurate notes, lists (and photographs) of possessions together with other records of assets. Accurate accounting is also imperative and its common that many people dealing with the estate themselves are not as stringent as they should be. Fishers Solicitors take away the pain and stress of this process.
4. Left out assets
Not collecting or identifying all the deceased assets is probably the most common error. A lay Executor will not have access to research and track down assets like Fishers. Remember Personal Representatives are held liable for any omissions. Even a bank account with a low balance is required to be accounted for and is something that should be included and not overlooked, no matter how small.
5. Distribution too soon
Sometimes pressure from beneficiaries may lead to distributing cash assets too soon. Funds should not be released early as a full understanding of all assets and liabilities is necessary. This includes tax payments (and waiting for clearance from HMRC). Also, you should not rely on your best guess when valuing estates or calculating taxes. Inheritance Tax is a complex area where professionals like Fishers should be advising.
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