A Helpful Explanation of Terms for Probate
Our Amye Aris helpfully explains what the terminology in Estate Administration and Probate means.
The loss of a loved one is upsetting enough. Having to then deal with arranging a funeral, locate a valid Will and then navigate the legal jargon used by solicitors whilst trying to deal with an Estate can be extremely daunting.
If you need help, our specialist team can assist with Administering Estates on behalf of executors. We provide a bespoke service, and our fees reflect the amount of work you need us to do. We deal with all matters with compassion and sensitivity and understand that clients come to us at an incredibly difficult period when dealing with grieving.
To ease some of this stress and help with the process of Estate Administration we have complied a glossary of terms that you may encounter.
GLOSSARY OF TERMS
| TERM USED | MEANING OF TERM |
| Administrator(s) | The person or persons who are required to deal with a deceased’s estate if there is no valid Will in place of if no Executors have been appointed or are able or willing to act in the Will |
| Administration Period | The period of time between the date of death and the date the estate administration is finalised |
| Administering the Estate | The collecting in, dealing with, managing and collating all of the deceased’s assets and then paying all debts, taxes, bills (liabilities) on their behalf. It is the finalising of all affairs |
| Appropriation | If a person is entitled to a legacy under a Will, they may prefer to have an alternative asset transferred to them in full or partial satisfaction of that legacy |
| Assets | Items that belonged to the deceased, for example personal effects, property, shares, investments, bank accounts, ISAs, premium bonds, chattels etc |
| Beneficiary | A person or persons entitled to benefit from a deceased person’s estate – either in monetary value or by receiving a specific asset |
| Bequest | The act of giving or leaving something to someone in a Will |
| Chargeable gift | A gift on which Inheritance Tax may well be payable |
| Codicil | An additional document or supplement that explains, modifies, or revokes all or part of a Will |
| Contingent gift | A gift which will only take effect if a certain condition ‘the contingency’ is met – i.e., a beneficiary attaining the age of 21 years old |
| Creditors | A company or person(s) to whom money is owed by the deceased |
| Debtors | A company or person(s) who owe the deceased money |
| Deed of Variation | A legal document which allows beneficiaries to make changes to their inheritance from a Will or Intestacy Rules after the person has died |
| Disbursement | A payment made to a third party such as the Court or Land Registry |
| Estate | The total property and all assets owned by an individual before they died |
| Estate accounts | A representation of the values of all the assets owned by the deceased as well as a calculation of the spending incurred during the Administration Period |
| Executor(s) | A lay person or professional such as a Solicitor who has been appointed by the deceased in their Will to deal with the Administering of the Estate |
| Grant of Probate | A legal document issued out of the Probate Registry Court to the Executors of the Will giving them the right to sell or otherwise deal with all Estate Assets |
| Grant of Representation | The Court order proving the legal authority of the person entrusted to deal with a deceased person’s estate. If there is a Will it is also known as a Grant of Probate, if there is no Will it is known as the Grant of Letters of Administration |
| Guardian(s) | A person appointed to look after a child or children under the age of 18 |
| Inheritance Tax | A tax payable on death upon the calculation of the net value of the deceased’s estate based on current legislation and reliefs available |
| Intestate/Intestacy | If someone dies, leaving no valid Will, there are prescribed rules set by Government which dictate the manner of the distribution of the deceased’s assets; how much and who will inherit a share in the estate |
| Legacy | A gift left in a Will of monetary value or specific items |
| Letters of Administration | A certificate provided by the Court allowing a named individual the right to administer an estate where the deceased did not leave a valid Will or where no Executors were appointed – see intestacy |
| Liabilities | The debts, bills, or costs that the deceased was responsible for paying prior to their death. The Personal Representative will pay these in full during the Administration Period |
| Life Interest Trust | The right (given by a Will Trust) to enjoy for life (or until such time specified in the Will or after an event has occurred). This can either be an interest in a property or share in money.
The person inheriting the right is known as the Life Tenant. The Remainderman will ultimately be entitled to inherit the asset after the termination of the Life Interest |
| Life Tenant | A person who has inherited the right to live in a property for their life pursuant to a Life Interest Trust in a Will. They are responsible for the upkeep costs, insurance and maintenance of the property for the duration of their stay. |
| Liquidating Assets | Selling a deceased’s assets to generate cash to pay the tax, creditors and/or beneficiaries |
| Next of Kin | A deceased person’s closest living relative |
| Pecuniary legacy | A gift in a Will leaving a lump sum in cash |
| Personal Representative(s) | An Executor or Administrator of an estate |
| Power reserved | The postponement of an Executor’s right to act in their role appointed via Will |
| Predeceased | A person who has died before the deceased |
| Renouncing probate | When an Executor gives up their right in totality to act in their appointed role from the start of a matter |
| Residuary beneficiary | The person or persons entitled to all that is left over in a deceased’s estate after payment of all taxes, liabilities, and funeral costs |
| Residuary estate | What remains in the estate ‘pot’ after payment of all expenses, liabilities, debts and taxes |
| Residuary legacy | The amount the Residuary Beneficiary receives after the payment of all expenses, liabilities, debts, taxes, and other outright gifts |
| Section 27 Trustee Act 1925 Notice | An advert placed in the local newspaper where the deceased was resident, as well as the London Gazette. It tells all creditors about the death and provides them with an opportunity to make a claim against the estate for monies due back to them before distributions are made. It is also necessary to place the Notice to protect Personal Representatives from liability for a claim being made against the estate after distributions have been made |
| Specific Legacy | A specific gift of an item such as a piece of jewellery, artwork etc belonging to the deceased and given to a nominated Beneficiary |
| Statement of Truth | A signed declaration made by Personal Representatives to confirm their entitlement to take out a Grant of Representation and that they will undertake the Estate Administration promptly, keep Estate Accounts etc |
| Testate | Reference to an estate of a deceased who has died without leaving a valid Will |
| Testator | A term used for the deceased |
| Trust | An arrangement (sometimes made in a Will) whereby a person (trustee) holds assets and/or property as its nominal owner for the benefit of one or more beneficiaries |
| Trustees | The persons nominated in the Trust Deed to looking after, managing or dealing with Trust assets |
| Will | A legal document detailing how a Testator wishes for their estate to be distributed and dealt with upon their death |
Amye Aris can be contacted [email protected] or 01908 542677
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