Why Probate is Not Required on a Small Estate
08 October 2019
By Probate Solicitor Kim Hammond
Probate is a legal process that's sometimes needed to deal with a deceased person's property, money and assets (their Estate). Probate is not always required for small Estates in England or Wales. This is because some assets up to a value of £5,000 can usually be transferred without going through the Probate process.
A small Estate is difficult to define, but usually if an Estate contains property or has a value of more than £5000, it will not be deemed a small Estate and Probate will be needed.
Obtaining a Grant of Probate
A legal document is often required to deal with the assets in a deceased person's Estate. This document is called a Grant of Probate if the Deceased left a Will, or a Grant of Letters of Administration if they didn't. These two documents work in largely the same way, granting the appropriate person legal authority to close bank accounts, sell shares and investments and sell or transfer property. To make matters simpler, we will refer to the Grant of Probate throughout the rest of this article, but the same information applies to both documents.
If the deceased left a Will, often this will name one or more Executors, who are the people responsible for taking on this role. If they died without a Will, it would normally be the next of kin that would need to go through the Probate process instead. This person is known as the Administrator.
If there is any uncertainty about who can apply for Probate, there is legislation setting out an order of priority. If you are in doubt, it is always sensible to seek professional guidance from a Probate Specialist as soon as possible.
For more information on what the role of Executor or Administrator entails, see Executor / Administrator Duties.
With our Probate Complete Service we take full responsibility for getting Grant of Probate and dealing with the Legal, Tax (excl VAT), Property and Estate Administration affairs*.
When Do You Need a Grant of Probate?
Applying for and obtaining a Grant of Probate from the Probate Registry can be a time consuming, complicated and draining process. This process it isn't always necessary, however, as Probate is not always required.
As mentioned, if the deceased had a small Estate (normally containing no property and a small amount of money) it's unlikely that a Grant of Probate would be required to deal with their assets. Different banks and building societies have different thresholds for Probate, with some agreeing to release up to £50,000 without Probate, while others set the limit at £5,000. For more information, see Bank Limits for Probate.
If the deceased held all their assets jointly with another person, a Grant of Probate may not be required to deal with these. This is because jointly owned assets will automatically pass to the surviving owner on the other owner's death. This is called the 'Right of Survivorship' and this applies to joint bank accounts and property owned as joint tenants (but not to property owned jointly as tenants in common).
However, there may be circumstances that assets are owned jointly, perhaps for convenience, but in reality the asset actually belonged to the deceased. In this instance, you may be required to obtain a Grant of Probate.
If the deceased owned significant assets in their sole name, a Grant of Probate will usually be required. However, there may still be circumstances where a Grant of Probate is not required.
Whether a Grant of Probate is required is often a question of:
- The value of the Estate as a whole
- The value of the asset in question
- Where the asset is held
The sale or transfer of shares, for example, often requires a Grant of Probate, but most share registrars have a "Small Estates Procedure." This means that if the shares held in the deceased's name are below a certain level (often as high as £10,000), these can be sold or transferred without a Grant of Probate.
Many investment companies also have Small Estates Procedures, though they will usually consider the value of the Estate as a whole rather than individual assets.
There are of course some circumstances where a Grant of Probate will be needed, even though the above criteria applies. As a general rule though, it will usually not be necessary to obtain a Grant of Probate for a small Estate.
If you are unsure of whether or not Probate is needed, get in touch with our award winning Probate team who will be happy to help you.
* We can also pay all the costs of a Co-op Funeralcare funeral, providing the Estate owns sufficient assets which can be sold in due course to repay our costs.
* There are no upfront costs to pay as our fees are deferred and will be taken from the Estate once it is in funds.
Co-op Legal Services is the largest provider of Probate and Estate administration services in England and Wales, and trusted to deal with over £1.3 billion in Estates annually.