Please can I ask for some help guys not really sure what to do and embarrassingly I don’t have a wide circle to ask this to for guidance.
i have been a beneficiary to an estate, my relative passed without a will back in 2017 and so his estate was split between his surviving siblings or in my case to me as the son of my father who’d passed before my relative.
probate was issued in September 2018 and then, distribution of the estate commenced in parts since August 2019. I say in part because with then Covid, and other happenings including a share holding in Ireland it took some time for the solicitors and executor to gather all share certificates and sell holdings ect.
id asked previously on here, because although just a beneficiary and because I wasn’t close or in contact with the administrator or other beneficiary that I had the feeling as if the solicitors were very slow to act, reluctant to share info and the executor also was advancing in age - my queries largely went ignored by the solicitor - namely enquiring when things would be wrapped up or an idea of what was remaining to be distributed.
some time passed and I began to commence a complaint to the ombudsman. In the last month however the solicitor informed me that the executor had now passed and they were awaiting instructions from their estate administrator.
Ive just received a call from the solicitor now, they wish me to take over as administrator- however I’m uncertain because they cannot tell me for instance roughly or realistically what exposure I’m facing in taking over administration
they tell me there’s some 50k held in their account, however additional inheritance tax owed might be in the region of 22k and some 5/10k of interest owed to Hrmc which is calculated from 6 months from date of death until paid - given the timescales involved this is hefty
they do not have full and final accounts and need to instruct an accountant, they also told me that as institutions only keep some records for 6 or so years that in doing the accounts they may not be fully complete and not sure how this will be looked at by Hrmc in closing off the estate
they couldn’t commit much to additional exposure I could be subject to only that the money on account is held for such remaining costs and what’s left then will be distributed among myself and the 2 deceased estates as they also bluntly imparted that both of these relatives had now passed.
not really sure what to do next - feel as if I’m opening myself to a big bill and I’ll have no other recourse other than myself to cover the bill should one occur
im waiting for them to put some of this in writing by email rather than accept on a call and said I need to think.
Sorry, I don't quite understand. What is it you are fearing you are "in for" if you took over the administration ? Any debts that need to be paid are paid by the Estate, not you personally. From what you said there is still an amount to be distributed, and out of this you think will be an element of IHT and other taxes. Has any IHT been paid to date ? Is the Estate big enough to warrant IHT being due ?
In a nutshell, if you took over being an executor or administrator you are not liable for any tax that may be liable.
Sorry if I've misunderstand your concerns.
This estate was liable to IHT, as he passed without a will and was a sizable amount - with no mitigations (wills & trusts people).
there’s about £57k on the solicitors account of which they estimate perhaps 32k of additional iht, interest and accountant fees and new probate registration.
final accounts are not prepared and they’re not certain that Hrmc will accept them or what would happen if they don’t
I guess I’m worried that I could be liable for anything outstanding outside of what the solicitors hold on account just to close off the estate fully and finally - I don’t beleive they’ve handled this in any way competently but that’s another matter
Executors/Administrators of an estate have the obligation to realise assets and pay any debts owed by the estate from those assets - no personal liability and if debts are greater than assets then the estate is insolvent and debts are written off.
However, you state that there is an outstanding IHT bill as the estate was a sizeable amount. If there is only £57k left then it would seem likely that some beneficiaries have been paid BEFORE all debts were settled - that's where the executors/administrators can be held liable as payouts to beneficiaries must not commence until all debts are settled. Ignorance of the debt is not a defence.
You need much more information - the $64,000 question to the solicitors is why is there only £57k left if there's IHT due?
Please can I ask for some help guys not really sure what to do and embarrassingly I don’t have a wide circle to ask this to for guidance.
i have been a beneficiary to an estate, my relative passed without a will back in 2017 and so his estate was split between his surviving siblings or in my case to me as the son of my father who’d passed before my relative.
probate was issued in September 2018 and then, distribution of the estate commenced in parts since August 2019. I say in part because with then Covid, and other happenings including a share holding in Ireland it took some time for the solicitors and executor to gather all share certificates and sell holdings ect.
id asked previously on here, because although just a beneficiary and because I wasn’t close or in contact with the administrator or other beneficiary that I had the feeling as if the solicitors were very slow to act, reluctant to share info and the executor also was advancing in age - my queries largely went ignored by the solicitor - namely enquiring when things would be wrapped up or an idea of what was remaining to be distributed.
some time passed and I began to commence a complaint to the ombudsman. In the last month however the solicitor informed me that the executor had now passed and they were awaiting instructions from their estate administrator.
Ive just received a call from the solicitor now, they wish me to take over as administrator- however I’m uncertain because they cannot tell me for instance roughly or realistically what exposure I’m facing in taking over administration
they tell me there’s some 50k held in their account, however additional inheritance tax owed might be in the region of 22k and some 5/10k of interest owed to Hrmc which is calculated from 6 months from date of death until paid - given the timescales involved this is hefty
they do not have full and final accounts and need to instruct an accountant, they also told me that as institutions only keep some records for 6 or so years that in doing the accounts they may not be fully complete and not sure how this will be looked at by Hrmc in closing off the estate
they couldn’t commit much to additional exposure I could be subject to only that the money on account is held for such remaining costs and what’s left then will be distributed among myself and the 2 deceased estates as they also bluntly imparted that both of these relatives had now passed.
not really sure what to do next - feel as if I’m opening myself to a big bill and I’ll have no other recourse other than myself to cover the bill should one occur
im waiting for them to put some of this in writing by email rather than accept on a call and said I need to think.
Sorry, I don't quite understand. What is it you are fearing you are "in for" if you took over the administration ? Any debts that need to be paid are paid by the Estate, not you personally. From what you said there is still an amount to be distributed, and out of this you think will be an element of IHT and other taxes. Has any IHT been paid to date ? Is the Estate big enough to warrant IHT being due ?
In a nutshell, if you took over being an executor or administrator you are not liable for any tax that may be liable.
Sorry if I've misunderstand your concerns.
This estate was liable to IHT, as he passed without a will and was a sizable amount - with no mitigations (wills & trusts people).
there’s about £57k on the solicitors account of which they estimate perhaps 32k of additional iht, interest and accountant fees and new probate registration.
final accounts are not prepared and they’re not certain that Hrmc will accept them or what would happen if they don’t
I guess I’m worried that I could be liable for anything outstanding outside of what the solicitors hold on account just to close off the estate fully and finally - I don’t beleive they’ve handled this in any way competently but that’s another matter
Executors/Administrators of an estate have the obligation to realise assets and pay any debts owed by the estate from those assets - no personal liability and if debts are greater than assets then the estate is insolvent and debts are written off.
However, you state that there is an outstanding IHT bill as the estate was a sizeable amount. If there is only £57k left then it would seem likely that some beneficiaries have been paid BEFORE all debts were settled - that's where the executors/administrators can be held liable as payouts to beneficiaries must not commence until all debts are settled. Ignorance of the debt is not a defence.
You need much more information - the $64,000 question to the solicitors is why is there only £57k left if there's IHT due?
I think it’s due because they took so long to sell some of the shares - some of this was due to waiting on replacement certificates and selling holdings in Ireland which they knew about before Brexit but didn’t sell until after Brexit - they also I think struggled with possible taxation overseas as in Ireland estate tax is paid by the beneficiary not by the estate - there were also additional shares found and sold after the initial iht bill was paid and distributions commenced in 2019 - plus now interest on what is remaining which is charged from the date of death until payment
I don’t think it’s a simple case of taking over but there are a number of unknowns as to the decisions taken thus far and their approaches and actions
If there are any monies due then it’s the responsibility of the Solicitors to pay those debts from the Estate. If the total amount in the Estate doesn’t cover the debts outstanding then that isn’t down to you. You’d have to likewise question why the Solicitor made Interim Distributions to you and others if there wasnt going to be enough in the Estate to cover those debts. From the figures you have been quoting it all seems a bit odd and I’d question why IHT is due. Furthermore the Solicitor can’t force you to take over the administration/become executor. In such cases where the named Executor has passed away then the Solicitor would act as the Executor. I can’t see why he/she can’t do so in this case. Unless of course they believe the increased costs incurred by them won’t cover their final bill. But that’s their fault if they have already made Interim Distributions, not yours.
I mean they have 57k odd left they just cannot fully commit to how much is left to pay to Hrmc or in iht - there are no other debts outstanding
just that records may not be complete to conclude the accounts and they cannot confirm if an accountant would have enough to go from nor what Hrmc would make of said incomplete accounts
feels as if it’s too much to bite off and open to problems
I mean they have 57k odd left they just cannot fully commit to how much is left to pay to Hrmc or in iht - there are no other debts outstanding
just that records may not be complete to conclude the accounts and they cannot confirm if an accountant would have enough to go from nor what Hrmc would make of said incomplete accounts
feels as if it’s too much to bite off and open to problems
All seems a little odd if I'm honest. I've dealt with a fair few estates, a number involving IHT.
1. HMRC/Probate office will not normally issue probate until such time as the accounts are fully complete and IHT is calculated. 2. After a period interest begins to accrue TO HMRC, you may wish to see here: https://www.hmrc.gov.uk/tools/inheritancetax/interest-rate-calculator.htm 3. Top have distributed money and having some outstanding that in itself must be the value of the estate, no?
I'd want to be seeing exactly what was filed and when. For instance a rough estimate based on those dates and say £10k was due in IHT that's yet to be paid, interest would be about 33%, i.e. £3.3k.
I mean they have 57k odd left they just cannot fully commit to how much is left to pay to Hrmc or in iht - there are no other debts outstanding
just that records may not be complete to conclude the accounts and they cannot confirm if an accountant would have enough to go from nor what Hrmc would make of said incomplete accounts
feels as if it’s too much to bite off and open to problems
All seems a little odd if I'm honest. I've dealt with a fair few estates, a number involving IHT.
1. HMRC/Probate office will not normally issue probate until such time as the accounts are fully complete and IHT is calculated. 2. After a period interest begins to accrue TO HMRC, you may wish to see here: https://www.hmrc.gov.uk/tools/inheritancetax/interest-rate-calculator.htm 3. Top have distributed money and having some outstanding that in itself must be the value of the estate, no?
I'd want to be seeing exactly what was filed and when. For instance a rough estimate based on those dates and say £10k was due in IHT that's yet to be paid, interest would be about 33%, i.e. £3.3k.
Thanks would you think this would be reasonable to ask for before agreeing to take over admin - also do you happen to know if I were then found issues or discrepancies I could take this up with the solicitors
I mean they have 57k odd left they just cannot fully commit to how much is left to pay to Hrmc or in iht - there are no other debts outstanding
just that records may not be complete to conclude the accounts and they cannot confirm if an accountant would have enough to go from nor what Hrmc would make of said incomplete accounts
feels as if it’s too much to bite off and open to problems
All seems a little odd if I'm honest. I've dealt with a fair few estates, a number involving IHT.
1. HMRC/Probate office will not normally issue probate until such time as the accounts are fully complete and IHT is calculated. 2. After a period interest begins to accrue TO HMRC, you may wish to see here: https://www.hmrc.gov.uk/tools/inheritancetax/interest-rate-calculator.htm 3. Top have distributed money and having some outstanding that in itself must be the value of the estate, no?
I'd want to be seeing exactly what was filed and when. For instance a rough estimate based on those dates and say £10k was due in IHT that's yet to be paid, interest would be about 33%, i.e. £3.3k.
Thanks would you think this would be reasonable to ask for before agreeing to take over admin - also do you happen to know if I were then found issues or discrepancies I could take this up with the solicitors
100% reasonable!
Although I'm not 100% clear as to what the solicitor has been doing (in relation to the administrator)?
I mean they have 57k odd left they just cannot fully commit to how much is left to pay to Hrmc or in iht - there are no other debts outstanding
just that records may not be complete to conclude the accounts and they cannot confirm if an accountant would have enough to go from nor what Hrmc would make of said incomplete accounts
feels as if it’s too much to bite off and open to problems
All seems a little odd if I'm honest. I've dealt with a fair few estates, a number involving IHT.
1. HMRC/Probate office will not normally issue probate until such time as the accounts are fully complete and IHT is calculated. 2. After a period interest begins to accrue TO HMRC, you may wish to see here: https://www.hmrc.gov.uk/tools/inheritancetax/interest-rate-calculator.htm 3. Top have distributed money and having some outstanding that in itself must be the value of the estate, no?
I'd want to be seeing exactly what was filed and when. For instance a rough estimate based on those dates and say £10k was due in IHT that's yet to be paid, interest would be about 33%, i.e. £3.3k.
Thanks would you think this would be reasonable to ask for before agreeing to take over admin - also do you happen to know if I were then found issues or discrepancies I could take this up with the solicitors
100% reasonable!
Although I'm not 100% clear as to what the solicitor has been doing (in relation to the administrator)?
As far as I can determine pissing about and delaying unreasonably
Comments
I don’t think it’s a simple case of taking over but there are a number of unknowns as to the decisions taken thus far and their approaches and actions
just that records may not be complete to conclude the accounts and they cannot confirm if an accountant would have enough to go from
nor what Hrmc would make of said incomplete accounts
feels as if it’s too much to bite off and open to problems
1. HMRC/Probate office will not normally issue probate until such time as the accounts are fully complete and IHT is calculated.
2. After a period interest begins to accrue TO HMRC, you may wish to see here: https://www.hmrc.gov.uk/tools/inheritancetax/interest-rate-calculator.htm
3. Top have distributed money and having some outstanding that in itself must be the value of the estate, no?
I'd want to be seeing exactly what was filed and when. For instance a rough estimate based on those dates and say £10k was due in IHT that's yet to be paid, interest would be about 33%, i.e. £3.3k.
Although I'm not 100% clear as to what the solicitor has been doing (in relation to the administrator)?