Administration of Estates

Procedure

In dealing with an administration of an estate, firstly, we would establish the extent of the client’s instructions and hence the retainer we have with the client. The client may instruct us simply to obtain the Grant of Representation; this would involve checking the extent of the assets and establishing if a Grant is required. In any case, if a Grant is not required, we would need to ensure that the relevant reporting to HMRC has been duly carried out – e.g. where a significant gift was made within seven years prior to death. Alternatively, the client may instruct us to complete the whole of the administration.

Fees, Hourly Rates & Value Element

The estate administration fees will depend on a variety of factors, including the nature of the retainer between us and the client – i.e. the extent of the client’s involvement, the work they are doing, and the paperwork and forms that need to be completed (which papers can be simple or complex).  It is difficult to estimate fees precisely, since some of the time spent is dependent on the actions of third parties, which are outside our control. We provide an estimate of costs, bearing in mind that the time taken to complete the matter may be more or less than the given estimate, dependant upon any complexities or unanticipated issues which may arise during the administration of the estate. A suitable caveat is included in our Client Care Letter.

Private Client fees are calculated by reference to the time spent by various members of W Davies’ Solicitors in dealing with the matter (and an additional percentage charge (between ½ to 1½ %) may be charged to reflect the responsibility element in relation to the size of the estate). Our hourly rates are currently between £165 and £350 plus VAT.

This estimate does not include Directors’ time for acting as professional Executors, which will be charged at a rate of £350 plus VAT per hour. It is not possible to anticipate the amount of time which will be required to be spent by the Executors, as this will occur on an ad hoc basis.

Since every estate is different, W Davies do not provide a fixed fee for the administration of an estate.

W Davies would generally estimate that between 20 and 30 hours of time is required to carry out the administration of an estate. However, this may vary depending on the complexity of the estate and the individual circumstances. This would also be dependant upon the experience of the practitioner dealing with the matter.

The client can request that costs should not exceed a given figure without seeking their permission to proceed further.  A client may request an updating of costs from time to time

Estate Examples

An example of a fairly simple estate would be:

1. There is a valid Will
2. There are no more than two beneficiaries
3. There is only one property
4. There are no disputes involved
5. There is no inheritance tax payable
6. The personal representatives do not need to submit a full Account to HMRC
7. There are no claims made against the estate
8. There are no chargeable gains on disposals made during the administration period

An example of a complex estate would be where the following might apply:

1. There is no Will
2. There are a number of beneficiaries and legatees and some beneficiaries may be charities or may live abroad
3. Agricultural property or business property assets are involved
4. There is Inheritance Tax to pay and a full Account to HMRC is required
5. There are foreign assets involved and domicile issues
6. Tax planning is required including a deed of variation or advice regarding the residence nil rate band

However, even in a simple case, there may be numerous small assets that require attention and time – hence, a varying of the fees.

Conveyancing or other work

We would provide a separate quotation for work such as conveyancing (e.g. sale or transfer of a property) or a contentious matter.

Disbursements

We may have to make payments (“disbursements”) on a client’s behalf to third parties during the course of the matter. Set out below is a list of the disbursements, which we would normally expect to have to incur. Some disbursements may not be foreseeable.

The following list is not exhaustive:

Timescale

In general, it is difficult to provide an accurate timescale regarding the administration of an estate, as we are dependant on the timescales of third parties (e.g. banks, building societies and HMRC). The timescale also depends upon the extent to which we already have relevant and accurate valuations, or whether we need to obtain them.

Obtaining a Grant of Representation usually takes between 3 and 9 months. Once obtained, the next stages would be to take the executors’ further instructions. At this stage, we would usually pay the liabilities and any legacies, before making interim distributions, where appropriate. We will ensure that all taxation is dealt with and that Executors’ Accounts are prepared for approval by the executors.

The second stage of the administration can take a further 6 to 12 months dependant on the timescales of third parties. The administration of particularly complicated estates can take longer.

If a matter is urgent – for example, where inheritance tax is due or overdue – W Davies will prioritise this.  Throughout the administration, we also take into account various applicable, key dates – e.g. the deadline for completing a deed of variation in order to benefit from an IHT advantage.

Invoices

W Davies issues an invoice for work carried out once we have received the sealed Grant of Representation. Depending on the complexity of the estate, it may be appropriate for us to deliver interim invoices; usually, this would be on a three or six monthly basis, until the administration period is concluded.  Fee estimates will be revised, where appropriate.  Once a Grant of Representation has been obtained, our initial costs estimate will be reviewed – and you will be advised accordingly.

If, for any reason, a client decides not to proceed with their instructions to us to act, then we will prepare an invoice for our costs on an hourly rate basis, for the period from receipt of initial instructions (to include our first meeting) to the completion of our involvement with the matter.

Payment On Account

W Davies reserves the right to require payment on account of anticipated costs or disbursements.