Dealing with the loss of a family member or friend is always difficult. Thorntons can handle all aspects of winding up their estate for you (known as an Executry), from arranging the funeral, obtaining Confirmation (Scottish Probate), gathering in the assets and paying any debts or Inheritance Tax, to settling with beneficiaries. It is difficult to provide a specific fee estimate for winding up an estate, as circumstances can vary enormously and often an estate of low or moderate value can be more complicated to administer than an estate of larger value. As a measure of fairness to both firm’s and their client’s Executry files tend to be independently assessed by a Law Accountant or Auditor of Court, albeit there are some particular aspects which might now be charged on a fixed fee basis.
Process of estate administration
If you are responsible for administering an estate it can be a daunting prospect. Our experienced team can guide you through the process, step by step, which can involve the following:
Step 1: We meet with the Executor(s) to find out the necessary information about the estate.
Step 2: We investigate the deceased’s estate and obtain information on the assets and liabilities.
Step 3: We prepare the Inventory and forms required for the Application for Confirmation.
Step 4: We provide copies of the Inventory and forms to the Executors and deal with the signing of the documents.
Step 5: We submit the Application for Confirmation to the Court, and also to HMRC when Inheritance Tax forms have to be submitted directly to them before Confirmation can be applied for.
Step 6: We gather in the assets of the estate.
Step 7: We deal with any debts, including legal rights claims, and legacies.
Step 8: We prepare the Executry Account or Cash Statement and distribute the estate to the beneficiaries.
If there is not a valid Will, additional steps are required, including submitting a petition to the c
Court to have an Executor appointed and obtaining a Bond of Caution.
If the estate is liable to Inheritance Tax, professional valuations may have to be instructed and clearance required from HMRC at the end of the administration, in addition to arranging the payment of any tax due.
How long will it take?
It is impossible to give a set time for winding up an estate as it can depend on a number of different factors. For instance, an estate which is quite small in value but with assets spread over a different number of organisations may take longer to complete than a high value estate where the main assets are held by one organisation. Factors that could cause a delay include:
- House to be sold
- Legal rights claim
- No Will, known as an intestate estate
- Missing beneficiaries
- Inheritance Tax due
- Overseas assets, especially if a separate administration process is required to deal with the asset, for example foreign shareholdings
- Income tax issues
- Claims by the DWP
- HMRC Inheritance Tax Compliance check
- Slow response to correspondence by asset holders
However, as a general guide, it is often possible to complete the administration of estates within the following timescales:
|
No house to be sold, not subject to Inheritance Tax, and total value of assets less than £100,000 |
4 – 6 months |
|
Total value of assets greater than £100,000, or including a house to be sold, and not subject to Inheritance Tax |
6 – 8 months |
|
Larger estate (value of assets over £250,000) or subject to Inheritance Tax |
9 – 15 months |
|
Complex estate including assets requiring specialist valuations (e.g. private company shares) |
12 months upwards |
Costs
Each estate is different and the work involved in winding them up can vary enormously, so it is difficult to give specific fee guidance when dealing with Executries.
Initial meeting only: We charge a fixed fee of £250 plus VAT for an initial meeting to provide advice and assistance to Executors, where we are not being instructed to administer the estate.
Confirmation only basis: If we are instructed on a ‘Confirmation Only’ basis (i.e. preparing the Application for Confirmation based on the information provided by the Executors), the minimum fee for this work will start from £3,000 plus VAT.
There will be a one off fee of £110.00 (+VAT) payable and charged to the Executry Account in respect of the administration process for completing the identity verification checks.
Fee assessment for estate administration:
Our usual practice is to submit our files to a Law Accountant or Auditor of Court for independent review, to assess a fair and reasonable fee for the work we have undertaken. They charge for this fee assessment and this charge would usually be paid from the estate. There are three principal factors taken into account in assessing a fee:
- Time spent carrying out the work
- Complexity and difficulty of any issues arising
- Commissions on cash transactions
This assessment is done and the final fee charged towards the end of the administration process, after the deduction of any interim fees that may have been charged during the administration of the estate. If you do not want this independent assessment of fee, you should advise us as soon as possible.
The following table is a guide to estimated costs for the administration of estates of average complexity and size. Please note: this table is not used to calculate our fees, but is a summary of the approximate bands assessed fees for average estates tend to fall into, based on our experience.
|
Gross value of estate (£) |
Estimated cost of administration as a % of gross value (excludes VAT) |
|
0 – 50,000 |
10 – 25% (minimum £3,000) |
|
50,001 – 100,000 |
5 – 10% |
|
100,001 – 150,000 |
5 – 8% |
|
150,001 – 200,000 |
4 – 7% |
|
200,001 – 500,000 |
3 – 6% |
|
500,001 – 750,000 |
3 – 5% |
|
750,001 – 1,000,000 |
3 – 4% |
|
1,000,001 – 1,500,000 |
1 – 3% |
|
1,500,000+ |
Depending on circumstances |
All fees are subject to VAT, which is currently charged at a rate of 20%.
Hourly rates: Where applicable, the hourly rates for our specialist Private Client team, are as follows:
| Partner | £360 |
| Consultant | £360 |
| Legal Director | £350 |
| Senior Associate | £320 |
| Associate | £320 |
| Senior Solicitor | £300 |
| Solicitor | £280 |
| Trainee Solicitor | £170 |
Additional costs:We always ensure that the work will be carried out by a team member at a level appropriate for the complexity of the matter.
- Confirmation dues:
- Estate valued £50,001 to £250,000: £271
- Estate value over £250,000: £543
- Individual certificates required, for example for a property or shareholding: £8 each
- Registering the Will: £20
- Petition for Appointment of Executor (Intestate Estates): £19
- Bond of Caution (Intestate Estates): cost is advised by the provider of the Bond when they have received the application and information on the estate
Why Thorntons
We look after a wide range of estates, from small to large, simple to complex, bringing peace of mind to clients by dealing with the executry administration process from start to finish.
With our many years’ experience of administering estates and acting for Executors, we can efficiently and effectively deal with all that is required, guiding you through the whole process.