When someone dies, it is often a family member or close friend who steps forward to act as executor.

At times, executors or administrators choose to handle probate or estate administration themselves, particularly when they are trying to keep costs down. In straightforward cases, that may be entirely appropriate. However, with significant Inheritance Tax (‘IHT’) changes approaching in April 2027, families may wish to think carefully before deciding to go it alone.

More than just Probate

Many people assume that applying for probate or Letters of Administration is the main task. In reality, obtaining the relevant grant is often just the beginning.

Executors are typically responsible for identifying all assets and liabilities, dealing with pension providers and investment companies, calculating any Inheritance Tax due, claiming available allowances and reliefs, handling tax matters during the administration period and ensuring distributions are made correctly and in a timely manner.

Executors do not choose to seek professional advice not because they are incapable of handling the work themselves. They choose to involve experts because the financial and tax consequences of getting it wrong can be significant. Professional guidance can help ensure reliefs are claimed correctly, deadlines are met and liabilities are identified before distributions are made.

Why April 2027 matters

From 6 April 2027, most unused pension funds and pension death benefits will form part of an individual's estate for Inheritance Tax purposes. For many families, pensions may represent one of their largest assets, creating additional reporting requirements and increasing the need to coordinate information between pension providers, beneficiaries and HMRC.

As a result, estate administration may become more complex than in the past.

With Inheritance Tax generally becoming due by the end of the sixth month following the month of death, delays in obtaining information from pension providers and other institutions can create both administrative challenges and additional costs for the estate where interest becomes payable.

Could professional advice save money?

Some executors avoid professional assistance because they understandably wish to preserve as much of the estate as possible for beneficiaries. However, focusing solely on the upfront cost of professional fees may overlook the much larger costs that can arise from missed reliefs, avoidable tax liabilities, delays or administrative errors.

An experienced solicitor, accountant or probate specialist may help to:

• Ensure all relevant estate assets are captured and forms are completed correctly. 

• Avoid under or overpaying Inheritance Tax.

• Reduce delays and HMRC queries.

• Minimise the risk of penalties and interest charges.

• Protect executors from personal liability.

In some cases, the savings generated through careful tax planning and administration can significantly outweigh the professional fees involved.

When “DIY” Probate may be appropriate

A ’DIY' probate application may be suitable for a straightforward estate where there is a valid, uncontested Will, no Inheritance Tax liability, and assets are limited to UK bank accounts, ISAs, National Savings products and perhaps a single property. There should also be clear information regarding the deceased's assets and liabilities, no trusts, business interests or overseas assets, and no disputes or complexities that could affect the administration.

In these circumstances, the Government's probate service is designed to enable executors to administer the estate without professional assistance.

Estates that may benefit most from professional help

Professional advice may be particularly worthwhile where:

• The estate may be liable to Inheritance Tax.

• Significant pensions are involved.

• Lifetime gifts have been made.

• Trusts form part of the estate.

• Overseas assets are held.

• Business or agricultural assets are owned.

• Beneficiaries are minors or vulnerable individuals.

• Family circumstances are complex. 

Questions to ask before appointing a solicitor

Not all probate services are the same. Before appointing a professional adviser, consider asking:

1.        How much experience do they have with estate administration, Inheritance Tax and taxable estates?

2.        Is their fee fixed, percentage-based or charged on an hourly basis?

3.        What services are included within the quoted fee?

4.        What circumstances could result in additional charges?

5.        How often will they provide progress and cost updates?

6.        Who will be your day-to-day point of contact?

7.        Can they provide an estimate of the likely timescale for administering the estate?

When choosing a professional adviser, the cheapest quotation is not always the best value. It may be worthwhile obtaining quotations from several firms and comparing both the scope of services and the proposed fee structure before making a decision.

Final thoughts

For some estates, handling the administration personally may be entirely appropriate. However, many CAM clients have wealth spread across investment portfolios, property, pensions and/or SIPPs, often creating a far more complicated picture than first appears.

As estates become increasingly complex, particularly following the planned pension changes from 6 April 2027, the value of specialist advice may lie not in what it costs, but in what it helps the estate avoid. A missed relief, an avoidable tax liability or a delay in obtaining vital information can often prove far more expensive than the cost of obtaining expert advice at the outset. 

If you would like to discuss how the upcoming pension and Inheritance Tax changes may affect your family, please speak to your usual CAM contact. We would be happy to discuss when professional legal or tax advice may be beneficial.