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Can A Bank Release Funds Without Probate?

Can A Bank Release Funds Without Probate? As well as deeply saddening, bereavement can be financially stressful for those left behind. Unexpected costs can leave surviving partners and family members struggling, leading some to ask if a bank can release funds without probate.

The answer to this question is broadly yes. Most banks will release at least some funds without needing to see a Grant of Probate. Indeed, most banks know that Inheritance Tax has to be paid – often from the deceased’s estate – before probate can be granted.

However, most financial institutions have their own rules in place. Some banks may even release large levels of funds without probate. But if you go too far with accessing these funds, you can leave yourself open to problems later down the line.

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Can A Bank Release Funds Without Probate?

Yes, most banks will release limited funds from the bank accounts of someone who has died to certain parties without probate. Generally, these funds are intended for three very specific purposes:

Covering funeral costs
Paying probate fees
Paying Inheritance Tax (this is actually required before a Grant of Probate can be issued)

Legally speaking though, banks aren’t required to release any funds at all without seeing a Grant of Probate from the executor of the estate or a Grant of Letters of Administration from the administrator (if the person in question died intestate, without a will).

How Much Can A Bank Release Before Probate Is Granted?

According to law, as of 1984, banks were limited to releasing only up to £5000 before probate was granted. These days, that’s not a lot of money.

Today, most banks will allow certain people to access far more than that. This figure varies and individual banks are currently free to set their own limits. Some may allow you to access up to £50 000 or more. Others may limit you to something more like £10 000 or £15 000.

Banks may also allow you to access smaller or larger amounts depending on the overall size of the assets in the deceased’s bank accounts.

Who Decides How Much Can Be Released Without Probate?

Despite the theoretical legal limit, individual banks and building societies tend to set their own rules for how much they release without probate.

The easiest way to find that limit for your bank is to check their website. Most are completely upfront about it.

Who will a bank release funds to?

In theory, a bank should only release funds of any significant size to the executor named in the will bearing a Grant of Probate or the chosen administrator of the estate with a Grant of Letters of Administration.

However, in recent years – especially during the COVID-19 pandemic and beyond – banks have begun to release ever-larger sums of money from the bank accounts of deceased people without asking to see a Grant of Probate or similar legal permission.

For those desperate to secure funds in a difficult time to cover the costs of funerals and the like, this has no doubt been a saving grace. Arguably, the original £5000 limit is far too small for modern needs in any case.

But probate rules largely exist for very good reasons. A Grant of Probate is only issued to someone who has proved they have the legal authority and are trusted to manage the estate of someone who has died. Not following probate rules risks the deceased’s wishes not being fulfilled.

There’s another risk too. Inheritance Tax has to be paid. Records of the deceased’s bank account (and their other assets) exist. Gaining access to the funds early might feel like a windfall. Needing more money to pay Inheritance Tax and other legal requirements later on feels much less positive.

What Can Released Funds Be Used For Or Spent On?

The only purposes that the funds released from the accounts of someone who has died before probate should really be put to are funeral costs and paying Inheritance Tax and probate fees.

As mentioned above though, growing laxity of implementation of the law following COVID-19 has seen these purposes being stretched. However, using access to these funds for other purposes can be very risky.

If a partner dies will a bank release funds from their sole accounts to the other partner?

Generally, a bank should freeze the sole account of someone who has died as soon as they are notified of the death. In order to release funds even to the other partner, a bank will normally want to see:

A copy of the death certificate
A certified copy of the will
The executor’s ID

The amount of time it takes to receive access to these accounts – and the level of funds that can be accessed – will depend on all of the factors mentioned above. Chiefly, the bank’s own regulations as well as perhaps the scale of the funds requested and those in the deceased’s account.

Of course, this is dependent on the language used in the will clearly showing that – as it does in many cases – the surviving partner will inherit everything in the sadly departed partner’s account. This makes a professionally written will a must for partners who have sole accounts yet are financially dependent on one another.

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What Happens When One Of The Tenants In Common Dies?

Tenants in common is a popular way for close friends and relatives as well as couples to purchase property. But what happens when one of the tenants in common dies?

Largely, this will come down to what the person who has died set out in their will (making it vital to draw up a will if you do intend to become a tenant in common).

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Yet there are many related questions about tenants in common – what happens when one dies and, sometimes more importantly, what the still-living tenant chooses to do about it:

Who Inherits My Share Of The Property?

As tenants in common, you will own a strictly defined share of the property in question. This could be a nice round number like 50%. This share can then be left to someone in your will. If the person you own property as tenants in common with is your partner, it could be them.

To make sure this happens, you can create what is known as a lifetime interest or a life interest trust of the property. You can then give your spouse or partner who is the other tenant in common that lifetime interest.

Were you to pass away, they would then be able to continue to live in the house. Technically, they still only own half of the house (or whatever division of it they did before). But thanks to the life interest trust, they can even sell the house (with some limitations) or pass it on to children when they too pass away.

What Happens If Your Tenant In Common Died?

In most of the UK, if your tenant in common has died, the first factor that determines what happens is whether or not they left a will laying out their wishes.

If the deceased did not leave a will, the Laws of Intestacy apply. These are default rules governing who inherits what when a person dies without specifying what should happen to their estate. Under intestacy rules, the surviving tenant in common does not automatically inherit the property.

In Scotland, there is a similar but slightly different situation. The survivorship clause common to joint property ownership in Scotland usually needs to be deliberately “evacuated”.

Otherwise, the surviving tenant in common (although this terminology isn’t actually correct in Scotland) will inherit the full property automatically.

If Someone Else Now Owns The Other Share, What Are My Options?

When you own a property as tenants in common with someone else, you and the other tenant can both choose who will inherit your share of the property were you to pass away. This can lead to situations where the surviving tenant now owns the property with someone they are not as close to.

For example, picture a couple who own property in common. One of them leaves their share to a child from a previous marriage who lives far away and is little known to the surviving partner.

If this sort of situation transpires, you have three basic options:

1) Buy Them Out

One of the simplest solutions is to buy out the new tenant.

Suggesting this can be a welcome solution for the new tenant too. They may already own property they live in or have no desire to move to the area where your property is situated, for example. They may also simply prefer to have funds to do with as they will.

2) Sell The Property And Buy Something With Your Share

Alternatively, both you and the new tenant might decide together that you both want to sell the property.

You might not wish to remain living in a home you once happily shared with someone else. They might have no desire to move in. Selling the property and buying a new one with your share can work well in this case.

3) They Buy You Out

Finally, the new tenant might want to live in the property (or have it available to rent out) while you might have no desire to be involved with it anymore.

In this situation, the new tenant may wish to buy you out. You might even suggest this as an option if you feel it would be the best solution for you. They can, as they say, only say no.
What happens when one of the tenants in common dies?

It’s clear that whether or not the deceased left a will is the deciding factor in what can happen when one of the tenants in common dies. This makes drawing up a will very important. However, if you are the surviving tenant, you have several options as to what you can do. Consult legal advice and think about what feels right before you make your choice.

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How Much Does Probate Cost In Ireland?

Probate law in Ireland has a few common misconceptions and assumptions surrounding it. But one of the most important questions is how much does probate cost in Ireland?

Let’s take a look at what probate is defined as in Ireland, whether you need it, and the costs involved:

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What is probate?

Probate is a legal process that gives someone the right to handle the estate of a person who has passed away. It is important to note though that probate is not always required after a person has died.

The probate process in Ireland requires someone to make an application to the District Probate Registry or the national Probate Office. If successful, the Office will send a legal document called a Grant of Representation.

This document is only issued if the Probate Office is content that the will is valid. If there is no will, you need to apply for a different kind of Grant of Representation (called a Grant of Administration). Once you have the document, you have the right to distribute the assets of the person who has died.

Do I need probate?

Probate is not always needed following a death in Ireland. You will need probate if the deceased person owned significant amounts in terms of:

Property – if the person who has died owned property in their sole name or as tenants in common.
Assets – if the person who has died owned notable assets in their sole name or in common.
Joint accounts – in some cases, even if the co-owner is alive, probate might be needed to distribute funds from a joint bank account.

As you can see, this list does not include any reference to whether or not the person who has passed away left a will.

There are circumstances where you will need to go through the probate process for a person who has left a will. Equally, you might not need to go through the probate process for someone who did not leave will.

What a will does is ensure that only the people whom the deceased person trusted most (those they named as executors of their will) can apply for probate and get that Grant of Representation.

How much does an estate have to be worth to go to probate in Ireland?

You won’t need probate in Ireland if the deceased person had what is commonly called a “small estate”. Unfortunately, there isn’t a set limit for what constitutes a small estate.

Individual banks and financial institutions set their own rules for this. And, because they control when or if they require a Grant of Representation before releasing a deceased person’s funds to someone else, the bank the deceased person used largely decides whether their estate is “small” or not.

However, a common rule of thumb for what constitutes a “small estate” is €25,000. Anything less than that is commonly not subject to probate. It is worth checking with the bank in question though as some set different thresholds.

How much does probate cost in Ireland?

Probate fees are levied at the following rates based on the net value of the estate in question. Be aware though that these are rates for personal applications. Probate fees are significantly cheaper in Ireland if a probate solicitor makes them on your behalf.

Estate valued at less than €100 000 – €200
Estate valued at less than €250 000 – €400
Estate valued at less than €500 000 – €700
Estate valued at less than €750 000 – €1000
Estate valued at less than €1 000 000 – €1300

If the estate is valued at more than €1 000 000, the fee goes up by €800 for every further €500 000 in value.

Do I need a solicitor to handle probate in Ireland?

Again, it’s worth noting that those fees listed above are personal application fees. Using a probate solicitor to handle probate in Ireland reduces those fees by half.

This means that using a solicitor is a smart move in some probate cases, depending on the complexity of the case and the size of the estate (that is to say, whether the money saved on fees will be greater than any fees the solicitor might charge).

There are also situations where Irish law requires that you use a solicitor for probate. For example, if there are disputes amongst the next of kin or if the person who should apply for probate is of unsound mind.

Apart from that, a probate solicitor adds value in that they can provide professional legal advice where you need it. This can start from the beginning, advising you on how much probate costs in Ireland – often before you need to pay any fees whatsoever.

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To be connected to a specialist probate solicitor near to where you live, please either call us now on 0845 1391399 or complete a Free Online Enquiry.

How Much Money Can You Have In The Bank Before Probate?

You usually need to apply for probate before you can deal with the financial affairs of someone who has died. But do you always have to? How much money can you have in the bank before probate becomes necessary?

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Let’s take a look into probate and learn about where different banks and building societies set the thresholds for the amount of money a deceased person can have in their bank accounts before probate is needed:

What Is Probate?

Probate is a legal process that often happens after someone passes away. When a person dies, under most circumstances, someone needs to control what happens to their estate (the collection of assets they gathered during their life – bank accounts, property, investments, but also debts).

As well as the process, “probate” also refers to the legal document that gives someone the right to do this. This document can be called:

A Grant of Probate if the person who has died had a will. In this case, the person given that right will be the executor of the estate named in the will.
A Grant of Letters of Administration if there was no will.

Why Is Probate Needed?

In general, if you want to deal with the assets of someone who has died – perhaps you want to sell the house they used to live in – you need to obtain the legal right to do so.

For example, banks don’t let just anyone access the accounts of people who have died. That’s why one of the things that has to be handled when a person passes away is notifying their bank so their accounts can be closed. This usually requires one of the above legal documents.

There are also some circumstances when the probate process isn’t needed:

Small estate – when the person who has died has what is called a “small estate”, a small amount of money in the bank and little else. This is usually what people are thinking about when they’re considering bank money limits before probate. We’ll get to it below.
All assets go to spouse – if the deceased chose to give all of their assets to their surviving spouse, then probate is not usually required.

What Is A Person’s Estate?

In legal terms, a person’s estate is everything they owned. This commonly includes:

Money – either cash or funds they have in a bank account or building society.
Money they are owed – this could be from other people, but could also include a life insurance policy.
Property – such as the home or business property they own, or perhaps some land.
Investments – shares, stocks, bonds, and other financial assets.
Personal possessions – such as jewellery or vehicles that are worth significant amounts of money.

It’s also important to note that a person’s estate has what we might think of as “negatives” to take away from it too.

Picture a person who has died owing money to perhaps a private hospital or care facility or who has a credit card bill, for instance.

How Much Money Can You Have In The Bank Before Probate?

There aren’t really any hard-and-fast limits to the amount a person can have in the bank before probate is needed. A ballpark figure would be around £10 000 to £15 000.

Yet it’s important to realise that it is largely left up to the discretion of individual banks to set limits for the amount of money they allow before requiring a Grant of Probate (or Grant of Letters of Administration) to release funds from the account of a deceased person.

A safe figure will always be £5000 or less with no property. The more complex an estate becomes, and the closer it gets to £15 000, the more likely it is for a bank to expect the probate process to be followed.

Bank Account Limits Before Probate

The figures that individual banks and building societies have set as thresholds as of early 2023 are:

£50 000 – Aviva, Bank of Scotland, Barclays, Halifax, Lloyds TSB, Nationwide, Santander.
£30 000 – Britannia, Co-op Bank.
£25 000 – Birmingham Midshires, Cheltenham & Gloucester, NatWest, Royal Bank of Scotland.
£20 000 – Sainsbury’s Bank.
£15 000 – M&S Money.
£10 000 – AXA, Bank of Ireland, Post Office.

Both First Direct and HSBC decide on a case-by-case basis and NS&I varies its figure depending on the number of executors and what the will says.

All in all, the probate process isn’t always as simple as you might think. It’s always worth confirming with a legal expert you trust or asking the bank directly how much money can be in an account before probate is needed.

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Trust Registration Service

Trust Registration Service – everything you need to know

The Trust Registration Service is an online system to help trustees (the people who are responsible for taking care of a trust) register a trust.

This is an important thing to do. Most trusts in the UK need to be registered in order to avoid fines and make sure the correct tax is being paid. There are also rules in place to prevent money laundering and terrorism.

To be connected to a specialist solicitor near to where you live, please either call us now on 0845 1391399 or complete a Free Online Enquiry.

But what is a trust? Why would you want to register one? Let’s take a deeper look:

What is a trust?

A trust is an arrangement used to hold assets (such as money, property, or investments) on behalf of someone.

A “settlor” puts these assets in a trust. The trust is managed by a “trustee” (they are supposed to follow the settlor’s wishes, much like the executor of a will). Eventually, a “beneficiary” – or several beneficiaries – will benefit from it.

There is a huge variety of different types of trust. These are treated differently for tax purposes and most have different rules, benefits, or purposes attached.

Why register a trust?

There are a number of reasons why you might want to register a trust. The most common are:

1) Protection and control of your assets

The way a trust works can be controlled via the documents (a Deed of Trust) used to set it up in the first place.

You might be able to set things like whether the trust is revocable (whether you can access it during your lifetime) or who the assets you’ve placed in trust pass on to.

2) Protection of young people or the incapacitated

If a young person has inherited a great deal of wealth or other assets – such as investments – that they don’t know how to deal with, it’s common for a trust to be set up to protect them.
The same is true of people who have become incapacitated for one reason or another.

3) Protection of your legacy

Some types of trust (often called a “will trust”) can be used to pass on assets to someone after you die. A trust can protect the assets you want to pass on to that person from creditors.
It’s also sometimes used to protect beneficiaries from themselves. If you’ve ever seen (perhaps in a movie) someone who isn’t allowed to access their trust until they reach a certain age or accomplish a certain life goal, this is the kind of stipulation to picture.

Do I have to register a trust?

There is a high likelihood you will have to register a trust with HMRC. However, some types of trusts and circumstances may make you exempt from this. In general, you will need to register a trust for reasons of:

Legal compliance – most trusts need to be registered because there are legal requirements designed to protect against money laundering and the financing of terrorism.
Tax return accuracy – income from trusts usually needs to be declared. To get a UTR (Unique Taxpayer Reference number), you need to register a trust.
Tax liability – if your trust becomes liable for any of a wide range of taxes (income tax, capital gains, stamp duty, and many others) you will need to register.
Specific trust types – even if you have no tax liability, you still need to register any UK express trust and non-express trusts that acquire UK land or property, have at least one trustee in the UK, or enter into a business relationship in the UK.

If in doubt, it’s always worth consulting a specialist trust solicitor. Otherwise, you risk falling afoul of laws largely created to prevent money laundering and terrorism financing. Being set against these laws is rarely a good thing.

How to register a trust

1) You can Do It Yourself (but it might not be a good idea)

It is possible to register a trust yourself. You can do so using the Trust Registration Service (TRS) for free.

It is worth knowing before you start though, that the system is not exactly simple to use. If you don’t have any understanding of how trusts work from a legal standpoint, it can be more than a little intimidating.

That’s why most people work with a trust solicitor or another expert representative.

2) Collect information

To register a trust with HMRC, you need to collect a great deal of information about:

Settlors
Trustees
Beneficiaries
Anyone else who has control over the trust

3) Verify information

It’s very important to provide the correct information when registering a trust. Unfortunately, the legal descriptions of some details are not always clear to someone without training.

Even something as simple as the “trust date” can vary dramatically depending on the type of trust that is being registered.

Getting help with the Trust Registration Service

Making mistakes with this information can leave you open to all kinds of fines and penalties. Again, this is why it’s usually smart practice to work with a solicitor you trust (pun not intended) so that the Trust Registration Service gets the correct information and your assets stay protected.

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Trust Solicitors Near Me

To be connected to a specialist trust solicitor near to where you live, please either call us now on 0845 1391399 or complete a Free Online Enquiry.