This is the third and final post about closing out a loved one’s estate. In our imagination your partner passed away leaving you to tidy up what they left behind. However, our advice is broad-reaching and should apply to almost every estate in the UK, and further beyond.
We reviewed obtaining a death certificate, registering the death, informing the authorities and friends, and arranging the funeral in Part 1. Part 2 addressed finding their will, attending to administrative matters, and getting permission from the government to carry out their wishes.
And Now for Part 3 Finally Closing Out the Estate
You should obtain your permission to proceed within 20 days from the government, assuming all went well. As touched on in Part 2, this will be a grant of probate if there is a will. Otherwise you will receive letters of administration meaning the assets distribute according to the laws of succession.
Your next step involves paying inheritance tax (if any), settling any debts, collecting all monies owed, and asking asset holders to release any funds they are holding.
They are entitled to ask for, and receive copies of the death certificate, and your grant of probate / letters of administration. Never let the originals out of your sight for a moment but be willing to produce them when asked.
You are Merely a Custodian, You Must Act Impartially
You are not in charge of what happens next. The deceased’s will is, or if they died without one then the law of succession for an intestate estate applies. It’s always best to place a statutory advertisement in The Gazette and one local newspaper.
This is because you have a duty as executor to take reasonable measures to trace any creditors and this meets this requirement. For if you do not, then a creditor could attempt to hold you personally responsible for their loss if the estate is already finalised.
You now have to wait two months to allow any creditor(s) to come forward. This is a suitable opportunity to negotiate with the heirs, and agree in principle how they should share the proceeds of the estate.
After Waiting for the Two Months to Pass, the Final Steps
You must first settle the estate’s debts, in this particular order according to the law:
- funeral expenses, if not previously paid
- taxes that are due (estate, personal, business, etc.)
- creditors, (loans, mortgages, all other debts)
Remember to ask for a full and final receipt of settlement in every instance. This will in any case be needed for your final set of accounts. The value remaining in the estate is now available to distribute to the heirs.
First obtain an estimate of the value of any share certificates from the registrars. While you are waiting obtain an independent valuation of any property. You can now finally distribute all the assets as we described above.
Finally, you have reached the end of the road. All that remains is to prepare a final set of accounts, and ask the main beneficiaries to approve it. Your task is over. Well done and we are delighted to have been able to assist you with your difficult task.
