The loss of a loved one is often overwhelming and having to sort out their affairs, especially if they didn’t leave a will, can be really stressful at such an emotional time.
If you have recently lost a loved one and they died without a will, don’t despair, as there are rules and procedures in place to make sure that you or somebody close to them can still distribute their estate. This guide will outline the steps you’ll need to take and some of the things you need to be aware of.
Someone who dies without leaving a will is deemed to have died “intestate”. In the absence of a will to distribute their estate, there are a series of laws called Intestacy Rules that determine how their assets will be handed out.
However, this process still requires someone to take responsibility for valuing the estate, settling the finances of the person who has died and making sure everything is distributed smoothly. This person is known as the administrator, and is typically a relative. If you’re familiar with the idea of an executor for a will, then the role of administrator is very similar, and involves most of the same responsibilities.
If you are a relative of the person who has died and are willing to take on the role of administrator, you can apply for a Grant of Letters of Administration, also known as Grant of Representation, Grant of Probate, or Confirmation (in Scotland).
The Intestacy Rules set out an order of priority for who can act as administrator. This order is:
- Spouse or civil partner
- Aunts and uncles
- Half-aunts and half-uncles
In other words, the spouse of the person who has died has the strongest legal claim to the role of administrator.
It’s also worth noting that none of the following steps are necessary if the estate either:
- Is entirely jointly-owned with a spouse or civil partner, as it will all pass to this person by default without being subject to Inheritance Tax
- Does not include any land, property or shares
Where to find help
Before you apply for the role of administrator, it is probably worth deciding whether you will want the help of a solicitor or probate specialist. There is no legal requirement to use one, but if you’re not feeling confident about the process, a lawyer could help give you peace of mind, but they do come at a cost.
They will be able to help make sense of intestacy rules and how they apply to families, clarify what assets your loved one had and generally demystify the process. It might be worth budgeting a few thousand pounds for these services if you think a specialist would be useful. If you don’t already have a solicitor, you can find one through the Law Society’s free Find a solicitor service.
Alternatively, you might decide to consult a solicitor or specialist for specific questions about the process rather than to bring them onboard for the whole thing. This will take longer and involve more independent work, but will likely be less costly overall.
If you’re unsure, you can read more about when to use a probate solicitor or specialist.
Applying for a Grant of Letters of Administration
If you are confident and would like to be the administrator for the estate of the person who’s died, then there are a few steps you’ll need to take.
1. Getting documents in order
You’ll need various documents ready for when you apply for the Grant of Letters of Administration with the Probate Registry. These are:
- The death certificate of the person who’s died
- Their birth certificate
- Their marriage or civil partnership certificate (if applicable)
You will also need specific forms to declare the value of the estate and pay Inheritance Tax, but these differ according to the estate’s total value and which part of the UK you live in. We’ll outline these later in a bit more detail.
2. Valuing the estate
Working out the value of the estate of the person who’s died is essential for filling in the correct forms and ensuring everything is passed on correctly. It’s important to note that the total value of the estate will likely differ from the value of the estate that will be subject to Inheritance Tax. This is because certain assets will likely be exempt from tax but included in the estate, while some others may be taxable but not count as part of the estate. You can find more information on both of these further on.
Valuing someone’s estate can be a very lengthy process. In some cases it can take between four and six months, or if the estate is particularly large or complex, it can take up to nine months or even longer. This is one of the steps where you might find it useful to seek help from a solicitor or specialist.
When valuing assets, you’ll need to factor in property, savings, shares, jewellery and any valuable collectibles. It’s a good idea to get objects in the last two categories professionally valued, particularly if you think they might be worth more than £500.
You will need to contact organisations such as banks, employers and pension providers to ask for specific probate values too. Make sure you have copies of the death certificate on hand for this.
You should also check if life policies are written in trust or fall into the estate. Additionally, you may also need to contact the Land Registry (England and Wales), the Department of Finance and Personnel (Northern Ireland) or the Registers of Scotland (Scotland) to find out how much of a particular property they owned.
You’ll need to take any jointly-owned assets into account too. If the person who’s died held equal rights to an asset with someone else (for example, a house or bank account with a spouse) then the asset will automatically pass to that person. This is an occasion where you’ll need to value this asset for Inheritance Tax, but it does not form part of the value of the estate.
There are also assets owned “in common”, where the owners hold different amounts of the same asset (rather than equal shares). This typically includes things like shares in a company and can include a share in a house. The main difference here is that this does not necessarily pass to the other owner. You’ll need to value these assets specifically as, unlike jointly-owned property, they are factored into the value of the estate for Inheritance Tax purposes.
Valuing all of the assets will allow you to work out the “gross value” of the estate. The next step is to find out what debts the deceased had and subtract this amount, as these will be paid out of the estate. This too may require reaching out to organisations such as mortgage companies, lenders, credit card companies, utility companies and so on. Funeral costs should be included in the debt too if the estate is paying for it, and if there is any joint debt, you’ll need to figure out their specific share of it.
GOV.UK includes a comprehensive guide on how to value an estate, but you should seek professional advice if you’re not confident going it alone.
3. Working out Inheritance Tax
After valuing the estate and calculating how much debt there is, you’ll need to figure out how much Inheritance Tax there is to pay. If the estate is relatively straightforward, this can sometimes be done with a brief summary form (IHT 205). However, in more complex cases, you may find you have to fill in a full version of the IHT 400 form.
Put simply, if the value of the estate totals over £325,000 and if no other reliefs are available, then Inheritance Tax will be payable at a rate of 40% of the amount above the £325,000 threshold. This amount comes out of the estate before it is distributed to the heirs.
However, it’s very important to note that there are additional exemptions to Inheritance Tax that can save a lot of money. The most common one, very simply, is that any assets passed directly to the spouse or civil partner of the person who has died are exempt from Inheritance Tax.
Certain other assets may be subject to reduced (or no) tax as well. The most common ones are certain businesses/business assets and agricultural assets.
If the person who has died was in the habit of making generous gifts (£3,000 or more) in any of the last seven years, you will need to go through the Inheritance Tax form particularly carefully to account for possible taxation on these. Gifts of this type will mean that you have to complete the full version of the HMRC Inheritance Tax form known as the IHT 400. You can find out more about taxation on gifts in our article Which gifts are exempt from Inheritance Tax?
In cases where such exemptions or gifts need to be taken into account and a full form needs to be filled in, you will most likely want to seek the help of a specialist or solicitor.
Inheritance Tax is due six months after the deceased passes away, and paying it late means being charged additional interest, so it’s worth trying to pay some or all of the tax before then (the tax on houses can be paid in instalments). You can find out more about how Inheritance Tax works in our article Understanding Inheritance Tax.
Typically, you’ll need to pay at least some of the tax before you can apply for Grant of Letters of Confirmation. Don’t panic if you don’t have the funds to do this yourself. Most banks will allow you to apply to have the tax paid from the account of the person who has died straight to HMRC, even if you cannot access these funds directly yourself. Alternatively, if you are planning to sell assets from the estate in order to pay the tax, you can ask HMRC for a Grant of Credit to do so.
Once you have completed these steps, you will finally be able to apply for the role of administrator, so that you can begin distributing the estate according to the Intestacy Rules.
This involves an application fee and filling out various forms, both of which will vary depending on where in the UK you live.
For general enquiries or help completing any forms, you can contact the Government’s Probate and Inheritance Tax Helpline.
England and Wales
In England and Wales, the administration fee varies depending on the value of the estate. Estates worth under £5,000 require no fee, while estates worth more than this amount require a fee of £215 (though this will only be £155 if you use a solicitor).
You’ll need to fill in the PA1 form and the correct Inheritance Tax form (IHT400 for complex estates or if the estate is worth more than £325,000, HT205 if the estate is less).
These forms are available to download from the GOV.UK website.
In Scotland, estates worth under £5,000 require no fee for confirmation, while estates worth over £5,000 will involve a fee of £200 to the Sheriff Court.
For estates worth less than £36,000 you’ll need forms C1 and C5(SE). For estates worth more than £36,000, you’ll just need the C1 form. You can contact your local sheriff clerk if you require assistance completing these.
You’ll need to send the necessary documents to the Probate Office in Belfast. Full guidance can be found here on the Nidirect website.
If the estate is worth less than £10,000, there is no fee. For estates worth £10,000 or more, there is a fee of £326 (or £261 if you are applying with a solicitor).
Once you have officially been named as the administrator, you can begin contacting any organisations holding assets of the person who has died to request their release to you (eg. banks). Be prepared to provide them with copies of your Letters of Administration to verify your role.
After paying off the debts of the person who’s died, you will need to make sure all of their remaining assets are distributed according to the Intestacy Rules.
Who Gets What - Intestacy Rules Explained
Assets are distributed as you might expect, roughly in the same order of priority outlined earlier. However, these rules do differ depending on where you live in the UK. Keep in mind that marriages and civil partnerships are the only kinds of partnerships that are recognised in these cases; long-term or cohabiting partners are not legally entitled to anything unless they jointly owned it with the person who’s died.
England and Wales
If the person who’s died was married or in a civil partnership and their estate is worth under £270,000, their entire estate will pass to their spouse or civil partner.
If they were married or in a civil partnership and their estate is worth more than £270,000, then what happens next depends on whether or not they have children.
◦ If there are no children, the spouse will inherit the entire estate.
◦ If there are children, then the spouse inherits £270,000, all personal possessions, and half of the estate that remains after this. The other half is shared equally among the children. If any of the children are under 18 then their share will be held by the administrator until they come of age.
- If there are children, but no spouse or civil partner, the entire estate is shared equally between them.
The rest of the order of priority is virtually the exact same as the order of priority for being an administrator. So, if there are no children, the estate passes to the parents. If there are no parents, it passes to the siblings, and so on. Children of aunts and uncles are also eligible if no aunts or uncles have survived.
If the deceased has no surviving relatives and has not produced a will, then their full estate goes to the Crown.
Intestacy rules are slightly more complex in Scotland.
If the person who has died was married or in a civil partnership and didn’t have any children, grandchildren, siblings or parents, everything passes to their spouse or partner. However, if there are children, grandchildren, siblings or parents, assets will be split.
If they are survived by children or grandchildren in addition to their spouse, then the spouse receives:
- Interest in the home up to a maximum value of £473,000
- Household contents up to a maximum value of £29,000
- Up to £50,000 in cash
- A third of the rest of the estate
The children or their descendants will then receive the remaining two thirds.
If the person who has died has no children but is survived by their siblings or parents in addition to their spouse, the spouse or partner will receive:
- Interest in the home up to a maximum value of £473,000
- Household contents up to a maximum value of £29,000
- Up to £89,000 in cash
- Half of the rest of the estate
The other half is split between the siblings or parents. If only siblings exist, this half will be distributed between them. Likewise, if only parents exist, this half will go to them. If there are living members of both groups then this amount will be halved again, and each of these halves divided among each group.
If there is no spouse, the estate in its entirety will be shared equally among any surviving children or grandchildren. If the person who has died has no descendants but is survived by their siblings or parents, then the full estate will be divided among them (rather than only half).
The rest of the order of priority is roughly the same as in England and Wales, except aunts and uncles come before grandparents.
If there are no surviving relatives and no will, then their whole estate will go to the Crown.
If there is no spouse or civil partner, then the entirety of the estate is passed to whoever is the highest in priority, according to the same order of priority as for being an administrator. So children first, then parents, then siblings and so on.
Things are a bit more complicated if there is a spouse or civil partner. If the estate is worth under £250,000, they will receive all of it. If it is worth more than that and there are other surviving relatives, it will be split.
Children and grandchildren take priority. If there is only one child, then the spouse or civil partner will receive up to £250,000 in assets, all personal belongings and half of the remaining estate. The other half will go to the child. If there is more than one child, then the spouse or civil partner will receive a third of the remaining estate instead, and the other two thirds will be split between the children.
If there are no children, then the parents are next in order. In this case, the spouse or civil partner is entitled to up to £450,000 in assets, as well as all personal belongings and half of the remaining estate. The parents then receive the other half. If there are no surviving parents, then the same numbers apply for any existing siblings. If there are no siblings either, then once again the entire estate goes to the spouse or civil partner.
As with England and Scotland, if the deceased has no surviving relatives and has not produced a will, then the entirety of their estate goes to the Crown.
Sorting out an estate when there’s no will isn’t always easy, and the rules can be complicated, so if you’re unsure how to proceed, it’s worth seeking professional help.
It’s also worth reminding loved ones that writing a will can make things much more straightforward when they die – as can arranging your own will. You can find out how to do this in our articles on How to write a will and the importance of writing a will.
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Have you had to sort out the estate of someone who died without a will? Do you have any tips for anyone who might find themselves in this situation? If so, we’d be interested in hearing from you. You can join the money conversation on the Rest Less community or leave a comment below.