The cost of Dealing with an Estate

We deal with many estates every year. When someone has passed away, their property, assets and liabilities all need to be dealt with. All of the assets of the estate need to be gathered together, the debts paid and the remainder distributed to those who are entitled to them either under a Will or the Law of Succession.

Given the nature of this type of work, it is difficult to offer a fixed fee or to list specific costs. There are, however, aspects of this type of work where we are able to offer a fixed fee service. In addition, we have to take into account whether there is a Will or not. Where there is no Will, additional work is needed to appoint an executor to deal with the administration of the estate.

We provide a couple of options when dealing with an Estate depending on the extent of the estate.

Obtaining Confirmation only

We can provide a very basic service for clients who wish us to obtain Confirmation only. This is where the executor has carried out all the work necessary to allow us to create the Inventory of Estate and present it to the Sheriff Court o enable Confirmation to be granted.

In these cases, there is almost exclusively a Will which appoints the executor to deal with the estate. This service does not apply where a the court needs to receive a Petition to appoint an executor.

Our fee for obtaining confirmation for an estate of that nature is £250 excluding VAT.

This means the cost to you, inclusive of VAT, is £300.

There are some additional costs that need to be added to our fee and VAT. These are costs over which we have no control but must be met to enable Confirmation to be granted.

The Will should be registered in the Books of Council and Session which will cost £10. In addition, when the Inventory of Estate is presented to the Sheriff Court to enable Confirmation to be granted, the court will charge a fee for receiving and examining the inventory. The level of this fee depends on the level of the estate. The current fees charged by the Sheriff Court are:

For an estate worth with a house worth, say, £165,000 (around the Scottish Average House Price), that would mean the costs would be as follows:

If you ask us to provide any additional service in relation to the estate, the fee basis will revert to our Full Estate Service fee

Obtaining Confirmation for a small intestate estate

This is the type of case where there are very few assets and only modest liabilities. In addition, in this type of case, there is no Will.

This means and application will be lodged in the Sheriff Court to appoint an Executor and, after that, we will make an application for Confirmation and then deal with the ingathering and distribution of the estate.

The fee we charge for a case of this nature is £500 excluding VAT. That means the cost to you, including VAT is £600.

There are, of course, additional costs you will incur when we deal with a case of this nature for you.

For instance, the fee taken by the court when the Petition for appointment of the executor is lodged Is £19. It is also likely that a Bond of Cautio will be required. This is a kind of insurance policy that must be taken out when someone dies without making a Wil and it is designed to protect the beneficiaries in an estate. The Premium is based on the value of the estate but with small estates, the premium will be in the region of £275. We will, of course, advise you of the premium when the insurance company informs us about it.

As in the case where there is a Will, the Sheriff Court charge a fee for receiving and examining the inventory of estate. This, again, is determined by the value of the estate. The current rate of charges are:

An example of dealing with an intestate estate where the value of the estate is, say, £!65,000 is as follows:

Full Estates Service

We also offer a full estates service where we deal with all aspects of the estate, working in conjunction with and as an agent for the executor.

Every estate is different and that means different steps need to be taken. We need to consider, firstly, whether or not there is a Will. Some estates of this nature are simple to deal with whereas others are very complicated and complex. That makes is almost impossibly to predict the likely fee for carryng out the work.

In some cases, Executors prefer that all aspects of the administration of the estate are dealt with by a solicitor. When we are instructed in that capacity, we will act as an agent for the Executors.

In such cases, we will charge our hourly fee of £250, exclusive of VAT. That means the hourly cost to you, including VAT is £300.

In addition to our fee, the Outlays involved are as discussed above in relation to more limited scope of work. These include registration fees for the Will, the Confirmation fee for examination of the Inventory of Estate and, where there is no Will, the fees due to the Sheriff Court and the Bond of Caution premium.

We take the following steps in our full estate administration service:-

• Meeting with Executors to explore the extent of the estate and establish family relationships.
• Investigating the extent of the deceased’s estate by communicating with organisations where the deceased held assets or had liabilities.
• Preparing the Inventory of Estate listing assets and liabilities.
• Having the Inventory approved by the executors and then having it signed.
• Applying to the Sheriff Court for Confirmation.
• Dealing with Inheritance Tax submission.
• Ingathering the estate.
• Settling debts of the estate and any Legal Rights liabiliies.
• Make payment of any legacies in the Will.
• Reviewing the tax position in respect of Capital Gains Tax and Income Tax and communicating with HMRC.
• Preparing the executry accounts and having these approved by the executors.
• distributing the estate to the beneficiaries.

Inheritance Tax

It is appropriate to provide a brief outline of Inheritance Tax (IHT). IHT is paid on the estate of someone who has dies in depending on the size of the estate. There is usually no IHT to pay if:

• The value of the estate is below the current threshold of £325,000, or
• You leave everything above the £325,000 threshold to your spouse, civil partner, a charity or a community amateur sports club.

In addition, this threshold can increase to £500,000 if you give away your home to your children or grandchildren.

If your estate does not reach the tax-free threshold and if you are married or in a civil partnership, any unused threshold can be added to your partner’s threshold when they die.

In some circumstances, it is possible that a surviving spouse or civil partner will have a threshold of £1 million.

If your estate is above the tax-free threshold, IHT will be charged at 40% of the balance of estate above the threshold.

Inheritance Tax is a complicated area of law. There are also a variety of exemptions and reliefs that might be applied. For further information on IHT, please visit the government’s website pages on Inheritance Tax.

If you would to speak to us about an estate in which you are involved, please contact us.