Dealing with Probate Shares Owned in the Wrong Name
05 September 2018
If someone owned shares at the time of their death but they were owned in the wrong person's name, then this can cause complications during Probate. In order for the shares to be sold or transferred on behalf of the deceased's Estate, they will need to be either transferred into the deceased's name, or a Grant of Probate obtained for the named owner of the shares.
Why Would Shares Be Owned in the Wrong Name?
The most common reason that we see for shares being held in the wrong person's name is because the shares were inherited from a pre-deceased spouse. Often in these circumstances, no Grant of Probate would have been needed and as such the shares were never officially transferred into the name of the person inheriting them.
This then goes on to cause complications when the person inheriting them dies, as the shares will need to be either sold or transferred as part of the Probate process.
Why Do Shares Need to Be in the Correct Name?
If the shares are held in the wrong name, then the name on the Grant of Probate won't match the name on the record of share ownership. This in turn means that they cannot be sold or transferred until this has been rectified.
There are strict processes in place for the sale or transfer of shares after someone has died, and these processes will need to be followed during the Probate process. If the name on the shares is not correct then the registrar will not be able to authorise the sale or transfer of them. For more information on the process, see Selling Shares during Probate.
So What Can Be Done?
Shares being held in the wrong name can cause lengthy delays in the Probate process and it's best to get the shares transferred into the correct name as soon as possible. However, this may not be straightforward to do.
With our Probate Complete Service we take full responsibility for getting Grant of Probate and dealing with the Legal, Inheritance Tax, Property, Shares and Estate Administration affairs.
The first thing you should do is to speak to the share registrar in question (this is the institution that keeps a record of the share ownership). In order to find out which share registrar you need to speak to, look at some of the share paperwork. The share registrar's name will be clearly stated on this, either at the top or the bottom.
The share registrar should be able to offer advice on the best way forward. They may request a Grant of Probate for the predeceased spouse so that they can transfer the shares out of their name and into the name of their spouse.
If a Grant of Probate can be obtained for the predeceased spouse then this could be a relatively straight forward solution, albeit time consuming as the Grant of Probate can take several weeks to process, as well as being costly. If the predeceased spouse died a long time ago then it might be a lot more difficult to obtain a Grant of Probate for them.
Another option may be to seek a Small Estates Exemption for the Estate of the predeceased spouse. If no Grant of Probate was required at the time of the predeceased spouse's death, because it was passing by spousal exemption, or because the Estate was too small to require a grant, then a Small Estates Exemption could be used to transfer the shares into the correct name. The share registrar will be able to advise if this is possible, and any fees payable.
If you're not sure what steps to take, then it's always wise to obtain independent legal advice. With our Probate Complete Service, our Probate specialists can deal with the sale or transfer of any shares owned by the deceased, even if these are held in the wrong name.