There’s a lot to organise when someone close to you dies. Once you’ve arranged the funeral, you’ll also need to sort out their affairs. If they made a will, the executors must ensure their wishes are followed. Probate can be part of this process but isn’t always needed. Following the rules is essential, so here’s our guide to help you understand when you need probate.

How does probate work?

Probate is the process that ensures everything’s settled properly after someone dies. It deals with distributing assets, paying debts, and paying inheritance tax.

The need for probate depends on the person’s assets, how they’re owned and what the estate is worth, so it can be simple or complicated. You can apply online, but there may be more forms if you have assets abroad, are claiming unused inheritance tax allowances from a spouse, or the finances are complex.

The process also differs depending on whether there’s a will. If there is, you apply for probate; if not, you’ll need to apply for letters of administration. You can find out more about how it works here: https://www.gov.uk/applying-for-probate.

What’s your estate worth?

As a general rule of thumb, you usually won’t need probate if your estate is worth less than £5,000. When you deal with probate, you estimate the value of the estate. This ensures that you pay the right amount of inheritance tax, but it can also mean that you don’t need to go through probate at all.

There are exceptions to this, depending on the type of assets and where they’re held. It’s important to check once you’ve got a clear picture of the individual assets and their worth.

Leaving joint assets

If you have joint bank accounts or own your home as joint tenants (where both of you own the whole house), they pass via survivorship. If it applies, you’ll need to pay inheritance tax, but assets like this don’t have to go through probate. However, you will need probate after the second death.

For example, if you own a house jointly and your partner dies, it’ll pass to you automatically. If you only have joint assets, you won’t need probate on your partners death. However, your executors must apply for probate after you’ve died.

Tenancies in common and trusts

If you own your home as tenants in common, each of you has a fixed share which you can leave in your will. You’re also likely to need probate. This type of ownership is often set up to ensure your share passes to the people you choose.  Commonly this is used to protect part of your estate from covering all the costs linked to care home fees, meaning the first person’s share passes into a trust when they die.

Some trustees skip applying for probate, which can cause problems further down the line. It’s essential to do things properly and get a clear paper trail. You’ll also need to update the Land Registry.

Assets with one owner

You may not need probate if you own all your assets jointly. However, if you own your house and have a joint bank account but have another account in your name, you’ll usually need probate, depending on the value of your estate.

We mentioned earlier that you typically wouldn’t need probate for assets under £5,000. However, financial institutions can ask for probate before releasing the money, and each one sets different financial limits. For example, Santander only requires probate if there’s more than £50,000 in an account; for Prudential, it’s £30,000, and for Premium Bonds it’s £5,000.

If in doubt, seek professional advice to ensure you follow the rules.

If you want to ensure you’re following the probate rules, we can help. Get in touch using the form below or call us on 0116 380 0752.