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Original poster

Executor's expenses

58 replies

legaleaglenot · 21/04/2021 17:25

I'm acting as the executor for my late grandad's will.

I've decided to do all the work on filling in the forms for probate, etc, on my own as Grandad's solicitor was going to charge a fortune. Solicitor is still available to advise me but I am just paying by the hour.

I thought I could put legal expenses, cost of valuations, cost of insuring the house until it's sold etc, against IHT. Solicitor says I can't claim for any of this, only for funeral expenses.

Does anyone have experience of this?

OP posts:
Original poster
legaleaglenot · 21/04/2021 20:45

Very sorry for your double loss @helpmemakeit. Good idea to start a support thread.

OP posts:
Brightermornings · 21/04/2021 20:47

I looked at getting a executor bank account but very few banks offer them. I've just opened another account in my name for any money to be paid into. I found HMRC helpful.

CarmelBeach · 21/04/2021 20:50

@Brightermornings

I looked at getting a executor bank account but very few banks offer them. I've just opened another account in my name for any money to be paid into. I found HMRC helpful.
I think Barclays and Natwest do them but the deceased has to have banked with them in the first place IYSWIM.

But neither bank told us this at the time, maybe we were meant to ask!

SavannahLands · 21/04/2021 21:00

I am just about coming to the end of my Probate year as an Executor, and due to.It being a complicated estate, I took the Option of using a senior Solicitor to do most of the work for us, as I'm so glad that we did. The cost has been covered by the estate for all expenses other than the Estate agents fees and Conveyancing costs connected with selling the property, which get deducted from the asset value of this before the legacies are divided between the Beneficiaries of the property named in the will.

HMRC are a complicated nightmare when it comes to allowances, Trusts, Charities, and Dealing with Inheritance tax. I'm now at a standstill and unable to finally sign off the Probate due to mistakes made by one of the Trustees in handling his mother's estate prior to the property being sold. He thought he knew what he was doing, but apparently not, and until.it's sorted I cannot fully complete the task.

The Probate certificate should allow you to apply to all the Banks to have the assets transferred into a Probate Executors account, to which you should have the facility to pay out Legacies, Expenses, and things like the final.utility Bills for the property once it is sold. The solicitor we used offered a fixed fee Probate package, which we have used, I could not have handled this all on my own.

Good Luck for your Probate Journey Year, and I'm sorry that you have lost your Grandfather.Flowers

Charley50 · 21/04/2021 21:08

How large is your grandad's estate OP?

OnkasBigMoka · 21/04/2021 21:20

@legaleaglenot I am not sure if you have considered this, but have you thought of consulting a dedicated probate service such as the one offered by the Co-Op?

I only suggest it because reading through the thread there seems to be a lot of advice that your solicitor has given you which seem very odd and doesn't ring true from my own experience when using the advice that the co-op provided.

I appreciate that every estate is very different and will vary in complexity but it sounds that it might useful to have a discussion with them.

Original poster
legaleaglenot · 21/04/2021 21:56

I’m a bit bashful about naming the figure, but it’s more than a million pounds.

The solicitor was quoting a fee of between 1 and 3 percent of the value of the estate.

OP posts:
CarmelBeach · 21/04/2021 22:15

@legaleaglenot

I’m a bit bashful about naming the figure, but it’s more than a million pounds.

The solicitor was quoting a fee of between 1 and 3 percent of the value of the estate.

I realise you don't want to give too much info but a note in case it's useful

We honestly didn't know the value until late on, and the solicitors we approached made a big deal of altered costs depending on the IHT form, they kept saying "if it's the longer IHT form, we charge more".

We filled in the longer IHT form. It's not complicated. I have no idea why they'd charge more for that.

I think it's wise to make minimal use of the solicitor, if we had used one we'd have chosen Co-op, who had a fixed fee service at the time.

Charley50 · 21/04/2021 22:34

I don't understand why your solicitor said that costs that can come out of the estate, can't come out of the estate. ??!!

So it's a big estate but presumably a lot of that is the value of his property? Anyway I'd crack on and do it yourself, as long as you can be organised about it, and make sure you don't pay more IHT than you need to. Look into Capital Gains Tax too, if you aren't selling the property immediately as part of Probate.

Original poster
legaleaglenot · 21/04/2021 22:42

I think TBF we were at cross purposes. I assumed that executor’s costs would be deducted from the value of the estate (like business costs are deducted from business tax rates) thus reducing the IHT bill. I now understand that I was wrong. But I can and will claim back these costs from the estate.

OP posts:
Charley50 · 22/04/2021 08:01

Well I think the value of the Estate is what is left over once debts, bills and certain gifts have been paid. Executor expenses would come out before the final value of the estate is calculated. List of expenses here, although it doesn't mention bills the property incurs even if no one is living in it, which can also be claimed back.

www.co-oplegalservices.co.uk/media-centre/articles-jul-sep-2019/what-are-reasonable-expenses-in-probate/

Neome · 25/04/2021 07:19

I would join a support thread. Dealing with my Dad’s estate which is just on the borderline of the threshold for IHT. I still don’t know which side it will fall.

(Currently puzzling over property maintenance and utility bills, bound to be a simple answer but can’t find it in the guidance. Does anyone know eg quarterly maintenance bill due before he died but covers period partly after death. Utility bills cut off date.)

CarmelBeach · 25/04/2021 10:43

@Neome

I would join a support thread. Dealing with my Dad’s estate which is just on the borderline of the threshold for IHT. I still don’t know which side it will fall.

(Currently puzzling over property maintenance and utility bills, bound to be a simple answer but can’t find it in the guidance. Does anyone know eg quarterly maintenance bill due before he died but covers period partly after death. Utility bills cut off date.)

I'm sorry Flowers

You mean he paid quarterly in advance but the direct debit is not correct because utilities were shut off? You should only pay what's owed.

lookingforbaubles · 25/04/2021 11:42

joining in for support - im dealing with my step mothers estate in the uk and what is turning in to a new level of tax hell -- her spanish estate

sounds very grand 'estate' but in reality its very small and i fear spanish lawyer and taxes will gobble it all up

CarmelBeach · 25/04/2021 15:46

baubles I don't know how that would work but giving it a bump just in case!

lookingforbaubles · 25/04/2021 17:38

thanks Carmelbeach - there are 2 wills, the uk one is just 2 bank accounts so fingers crossed straight forward

the spanish side of things is very educational !! - seems all taxes have to be paid before the estate is released

how much tax you pay depends on your personal circumstances not just the value of the estate - its all quite bonkers!

CarmelBeach · 25/04/2021 17:55

"Looking" personal circumstances, that's crazy.

If it's two bank accounts here, they might release it without probate, depending on the amount. We were very surprised to have two banks offer this on seeing the death certificate.

lookingforbaubles · 25/04/2021 22:31

alas hsbc insist on probate - isnt it crazy that all banks have a different bench mark for probate kicking it

i just wonder if all those brits living in spain realise what an absolute nightmare the system is out there -- if you leave your estate to 4 adult children they get 25% but some may pay much more in tax than others to get that 25 % share!

unlike the uk with help lines for probate, in spain its impossible to sort it out yourself so lawyer fees are also a big factor - plus they fine you if you havent paid the taxes within 6mths of the death!

CarmelBeach · 25/04/2021 22:43

You get fined if you don't pay IHT here in six months!

We've got friends whose parents aren't well. They have a small property in France. When the time comes, that's going to be an issue.

My parents wanted a timeshare at one point but this is apparently a nightmare though they were all the rage decades ago.

lookingforbaubles · 26/04/2021 13:59

a uk fine?? is that 6mths from the time of death or probate?

im still waiting for the spanish death certificate to arrive before i can even start on the uk probate - i have a scanned copy but not a 'hard' copy which i need it seems

i have emailed the Spanish office to politely ask where it is but they just came back with 'its been Easter, every thing shuts down for 2 weeks' !!

i have been recommended a spanish lawyer - with great english thankfully - so far the estimated costs will be 1800 for his fee and 2000 for legal fees, then there is the death tax fee of course -- all this money has to be paid out before the house is sold or the bank accounts accessed!

there is an option to just sign and walk away from the estate which happens a lot - wonder why!

HarrietteNightingale · 26/04/2021 14:23

They don't fine you after 6 months from time of death. They just start to charge you interest on the IHT you will need to pay (when calculated) if you haven't paid it by then. And that deadline is the end of the sixth month after the date of death.

They fine you after a year.

Planttrees · 26/04/2021 14:40

I may be a bit out of date but my opinion is that uou need to split all the bills between those that were owed up to the date of death and those incurred afterwards. All the bills relating to the period prior to death can be deducted in arriving at the value of the estate for IHT but those occuring afterwards can't (I think the funeral costs are an exception to this). However the post-death expenses on the house and getting valuations etc will come out of the estate funds so you in effect should be reimbursed.

CarmelBeach · 27/04/2021 17:13

@HarrietteNightingale

They don't fine you after 6 months from time of death. They just start to charge you interest on the IHT you will need to pay (when calculated) if you haven't paid it by then. And that deadline is the end of the sixth month after the date of death.

They fine you after a year.

Ah right.

I just get really annoyed by the whole thing so it might as well be a fine. Interest goes to HMRC pocket I presume?

TimeforaGandT · 27/04/2021 17:25

CarmelBeach - solicitors will charge or base their fee on the time spent and IHT 400 and all the supplemental forms take a lot longer to complete than the basic form. When I did it recently it ran to 80+ pages in total - and took a very long time to complete.....

CarmelBeach · 27/04/2021 17:28

@TimeforaGandT

CarmelBeach - solicitors will charge or base their fee on the time spent and IHT 400 and all the supplemental forms take a lot longer to complete than the basic form. When I did it recently it ran to 80+ pages in total - and took a very long time to complete.....
Of course. I was just saying to OP that she might be all right to complete it herself.