My father passed away few days ago. I am not looking for sympathy but I am now tackling all the bureaucracy and management of his estate. It can get quite complicated so I thought I would share with you some initial findings which may help if you are ever in this situation.
I know that many people are uncomfortable with death planning but if you don't, you leave a horrible mess for your loved ones, with Rachel From Accounts slathering over the amount of tax she will earn.
Planning:
Financial Planning
There are major changes to IHT coming in 2 years time and not for the good. I urge you to talk to an IFA and see what you can do to minimise your IHT bill.
The Will
I don't care how young you are everybody needs a will. This is a whole other topic but for god's sake do it otherwise you may find the wrong people inheriting.
Power Of Attorney
You also need to give a Power of Attorney for Health and Finances to people you trust. A POA can be done by a lawyer and will probably cost up to £1000. I did my own using the online government service it cost about £160.
www.gov.uk
My father did his (Financial POA) through a lawyer about 15 years ago, however he did not release it to me until a few weeks before his death. It was too late. Once you have a POA you need to register it with the bank(s) before they will allow you access. It takes a couple of weeks for the banks to act on it and my father died before the process was complete. The POA dies with the person so don't leave it too late.
Probate
When we looked at his estate he had a lot of money with one bank which was over their probate limit. This meant if he died his estate would automatically go the probate route. You would think that the probate limit is the same for all financial institutions but it's not. They can and do set their own limits. They range from 50k to 5k and in the case of Premium Bonds and National Savings zero.
Probate should be avoided if possible as the service has been criticised by the House of Commons as unfit for purpose. It means that you cannot pay out the estate until the court approves it and I am hearing that even simple cases are taking up to a year.
Now if my father had give me the POA earlier I would have transferred some of his savings to a new FI so it would have been below the probate limit. However it never happened so I an now waiting for that bank to confirm we will have to go through probate.
Death Notification
There are many many organisations that need to be informed from banks to utilities to the tax and benefits people. The government has a one stop shop
Tell Us Once
www.gov.uk
Death Notification Service (Banks and Insurance)
Who Pays The Bills
Once a bank has been notified they will freeze the account. I am still looking at this but so far the advice I have seen says as the Executor of his will I will have to pay any bills and reclaim from the estate once probate has been approved. In my cases I will split the bills with a family member, we are not expecting any large ones, nether the less we have already spent a few hundred on stuff like death certificates, extra funeral expenses. We may have to pay benefits some tax as well as utilities..
So be prepared to pay up front and then have to claim back.
Others
My father planned and paid for his own funeral, even so we have discovered there is still a lot to do especially around the service so the more instructions you leave the better e.g. what songs / prayers do you want.
Age Concern has some good fact sheets on what to do which have been quite handy. You may want to employ a lawyer but that will be expensive and if the will is simple shouldn't be necessary.
That it for now I will update as the process starts to unfold.
I know that many people are uncomfortable with death planning but if you don't, you leave a horrible mess for your loved ones, with Rachel From Accounts slathering over the amount of tax she will earn.
Planning:
Financial Planning
There are major changes to IHT coming in 2 years time and not for the good. I urge you to talk to an IFA and see what you can do to minimise your IHT bill.
The Will
I don't care how young you are everybody needs a will. This is a whole other topic but for god's sake do it otherwise you may find the wrong people inheriting.
Power Of Attorney
You also need to give a Power of Attorney for Health and Finances to people you trust. A POA can be done by a lawyer and will probably cost up to £1000. I did my own using the online government service it cost about £160.
Make, register or end a lasting power of attorney
How to make a lasting power of attorney (LPA): starting an application online, choosing an attorney, certifying a copy, changing an LPA.
My father did his (Financial POA) through a lawyer about 15 years ago, however he did not release it to me until a few weeks before his death. It was too late. Once you have a POA you need to register it with the bank(s) before they will allow you access. It takes a couple of weeks for the banks to act on it and my father died before the process was complete. The POA dies with the person so don't leave it too late.
Probate
When we looked at his estate he had a lot of money with one bank which was over their probate limit. This meant if he died his estate would automatically go the probate route. You would think that the probate limit is the same for all financial institutions but it's not. They can and do set their own limits. They range from 50k to 5k and in the case of Premium Bonds and National Savings zero.
Probate should be avoided if possible as the service has been criticised by the House of Commons as unfit for purpose. It means that you cannot pay out the estate until the court approves it and I am hearing that even simple cases are taking up to a year.
Now if my father had give me the POA earlier I would have transferred some of his savings to a new FI so it would have been below the probate limit. However it never happened so I an now waiting for that bank to confirm we will have to go through probate.
Death Notification
There are many many organisations that need to be informed from banks to utilities to the tax and benefits people. The government has a one stop shop
Tell Us Once
What to do after someone dies
The steps you must take when someone dies - register a death, report a death with Tell Us Once, coroners, funerals and death abroad.
Death Notification Service (Banks and Insurance)
Who Pays The Bills
Once a bank has been notified they will freeze the account. I am still looking at this but so far the advice I have seen says as the Executor of his will I will have to pay any bills and reclaim from the estate once probate has been approved. In my cases I will split the bills with a family member, we are not expecting any large ones, nether the less we have already spent a few hundred on stuff like death certificates, extra funeral expenses. We may have to pay benefits some tax as well as utilities..
So be prepared to pay up front and then have to claim back.
Others
My father planned and paid for his own funeral, even so we have discovered there is still a lot to do especially around the service so the more instructions you leave the better e.g. what songs / prayers do you want.
Age Concern has some good fact sheets on what to do which have been quite handy. You may want to employ a lawyer but that will be expensive and if the will is simple shouldn't be necessary.
That it for now I will update as the process starts to unfold.
