Actually, the statement I hear is “I have a Will so I won’t need probate”. Let’s clear this up now, THE TWO ARE NOT LINKED. Yes, they are both relevant to death but one does not negate the need for the other.
A Will is a legal document drawn up in your lifetime. It enables you to specify the beneficiaries of your estate and how it is distributed. Your estate may comprise of possessions, money, property and land. A Will also enables you to state who you wish to administer your estate at your death i.e. your Executors. Lastly, it also means you can control who are the guardians of your children under the age of 18.
If you don’t have a Will, at your death you are said to have died ‘intestate’. For more information, see our intestacy blog.
However, PROBATE (from the Latin word meaning ‘to prove’) is the legal process that happens when you die. The main purpose of Probate is to give a person (or people) the legal authority to administer your estate. These people are called Personal Representatives (PRs).
Probate enables the PRs to access your assets at your death, such as your bank accounts, property and pensions. It means they can do things such as:
- Finalise utility bills
- Sell or transfer property
- Gather in assets, including pensions, stocks, shares and savings
- Liquidate (sell) all the assets in your estate
- Pay any outstanding debts using funds from the estate
- Calculate and pay any income tax or inheritance tax due
- Distribute the estate to beneficiaries (as set out either in your Will or via the Law of Intestacy).
I think the reason people often get confused regarding Probate is because Probate is not always required at death. There are two main reasons why Probate may not be required at your death:
- You own all your assets JOINTLY usually with your partner or spouse who is still alive. In this case, at your death, all your assets would pass automatically to the other joint owner according to the Law of Survivorship; therefore no administration is required. This is why I often hear “we didn’t need probate at my dad’s death so why do we need it now that my mum has died?”. At the father’s death, all the assets were owned jointly between mum and dad so passed automatically at his death to the mother.
- There is very little in your estate i.e. it’s a small estate. Financial institutions such as banks and building societies all have their own individual Probate threshold. So if, at your death, you have a certain value of savings in a bank and that amount exceeds the bank’s Probate threshold, the bank will need a ‘grant of probate’. Without this, the bank won’t release those funds to your executors or PRs so they may be distributed to the beneficiaries. To make life a little trickier for your PRs, every establishment has a different threshold. So, the same amount may trigger the requirement for a ‘grant of probate’ at one bank but not at another!! So, it could happen that if the value of your estate is held in several banks and the level of funds in each is under that bank’s threshold, no Probate will be required.
Importantly, do bear in mind that if a property is not owned jointly (i.e. as joint tenants) but it is owned as ‘tenants in common’ then a ‘grant of probate’ is ALWAYS required. This is why a ‘grant of probate’ is often required at the second death of a couple – the property passed to the joint owner at first death but is now owned solely by the remaining spouse; at their subsequent death, a ‘grant of probate’ is required.
So, you see that a Will and Probate are totally separate concepts; the Will enables you to say how your estate is to pass at your death; Probate is the legal authority for your PRs to carry out the wishes in your Will. It is not the Will that dictates whether Probate is required but instead what your estate is comprised of.