Administrator of an Estate

DRice

Hi I am tasked with being administrator of my dad's estate and my mother is keen to save on solicitors fees and wants me to do it all directly with the powers that be. The solicitors fees are fairly high at 2% of the estate so we would be saving a fair few bob

Its not a compliated estate, its cash, investment bonds and very small amount of vodafone shares and there is likely to be no disputes. There is no will so we are bound by the succession act anyway. No property is involved.

Is this feasible? I have no legal background at all other than basic everyday knowledge, but I do have financial experience working in finance/accounts and life assurance in a past life.

coylemj

Yes, if you're a reasonably well organised person you can do it, its called a personal application (for grant of representation). Read the guidance here and especially note the link to several important documents on the right.....

http://www.courts.ie/courts.ie/library3.nsf/pagecurrent/F119B8741852DF7B8025810F005C1C0E?opendocument&l=en

hullaballoo

It can be done all right as above. One thing to be wary of is that dealing with securities other than cash is a bit of a headache. The registrars like to play silly beggars.

Revenue also have a lot of requirements with multiple tax returns in order and the CA24 which is a bit of an unweildy best in itself.

Personally, I'd pay a solicitor rather than deal with all that's involved myself but I would agree a fee in advance with a solicitor at the outset. Again it's personal preference but I would be happy to set the fee as a per cent of the estate but I would suggest you could try and get a lower rate than 2%.

Peregrinus

Obviously if 2% of the estate represents "a fair few bob", then 100% of the estate is quite a large amount of money. If it's mostly cash, shares and financial instruments it could be quite a fiddley administration, especially if investments are spread across a range of different instruments with a range of different financial institutions. And compiling the estate accounts will be a pain.

For which reason I think there may not be much reduction to be had on the 2% fee. Solicitors mostly cost their services based on the time expended. Fiddley administrations take a lot of time.

But it's all work that should be within the ability of a reasonably competent and organised person who has "experience working in finance/accounts and life assurance".

So, basically, DRice, it depends on whether you want to pay to make the hassle go away. Or, more accurately, whether you want your mother to pay to make the hassle go away, since your mother will ultimately bear two-thirds of whatever fee is paid to a solicitor. Not that I'm trying to guilt you or anything.

If in fact your father's affairs are simple and there are only a couple of bank accounts, a couple of investments and the Vodaphone shares, that does reduce the fiddleyness of the work, and means there may be scope to shop around for a lower fee. But it also means it would be less hassle for you to do it yourself, so the fundamental question you have to ask yourself is the same; "what is my preference between avoiding hassle, and avoiding fees?"

DRice

Thanks couldn't have asked for a more comprehensive reply. I never thought about tax returns. The Vodafone shares are trading at a loss and the only income is deposit interest. The life assurance bond does not attract capital gains. do we still need a tax return? He was a paye worker so he never filed a return

Peregrinus

You're going to have to file an Inland Revenue Affidavit setting out the assets of the estate. That's not strictly speaking a tax return, but it will contain information relevant to possible inheritance tax liabilties. Your mother will not have an inheritance tax liability, but you (and any siblings you may have) may do, depending on how much you inherit and how much you have already received by way of gifts and inheritances.

If the estate's only income is deposit interest which has been subject to DIRT, and if there is no gain on the shares, I don't think the estate will have any income tax or CGT liablity.

hullaballoo

You can write to revenue and ask them what their requirements are regarding the estate's income tax affairs and they will tell you what's required but in general, an income tax return is due to be filed for the year to date of death. If he was in receipt of social welfare or a state pension, those are calculable as is deposit interest.

Vodafone shares are particularly difficult to deal with, mostly due to their extremely low value. Brokers have no interest obviously, their fees would consume the value of most holdings and then some. You can, at length, have the shares transferred into the names of the beneficiaries if you want to hang on to them. If you want rid of them, there is a UK charity that accepts donations for small worthless shareholdings.

The CA24 is always required for a grant of representation but it's more of a ballpark estimate of the estate's value than a finicky return.

Each beneficiary has to submit an inheritance tax (capital acquisitions tax) return, which is more precise and completed towards the end of the administration when the actual value of the estate has been ascertained etc.

If you enjoy form-filling and receiving bureaucratic nonsense in reply thereto, it's a rewarding process.

DRice

hullaballoo wrote: »

You can write to revenue and ask them what their requirements are regarding the estate's income tax affairs and they will tell you what's required but in general, an income tax return is due to be filed for the year to date of death. If he was in receipt of social welfare or a state pension, those are calculable as is deposit interest.

Vodafone shares are particularly difficult to deal with, mostly due to their extremely low value. Brokers have no interest obviously, their fees would consume the value of most holdings and then some. You can, at length, have the shares transferred into the names of the beneficiaries if you want to hang on to them. If you want rid of them, there is a UK charity that accepts donations for small worthless shareholdings.

The CA24 is always required for a grant of representation but it's more of a ballpark estimate of the estate's value than a finicky return.

Each beneficiary has to submit an inheritance tax (capital acquisitions tax) return, which is more precise and completed towards the end of the administration when the actual value of the estate has been ascertained etc.

If you enjoy form-filling and receiving bureaucratic nonsense in reply thereto, it's a rewarding process.

There is of course no capital gains tax on death anyway . If the shares are held onto that should simplify the shares issue ? Cant wait for the bureaucracy!

hullaballoo

Capital acquisitions tax and capital gains tax are different beasts and although CAT almost always arises, CGT can also frequently arise in administration of an estate.

Carawaystick

would a tax accountant be a better professional to advise?

GavMan

You have to ask yourself, If I do this wrong, am I likely to cost myself more money and time than if I had gotten a professional to do it in the first place

coylemj

GavMan wrote: »

You have to ask yourself, If I do this wrong, am I likely to cost myself more money and time than if I had gotten a professional to do it in the first place

Unless you deliberately conceal assets, it's very hard to get it wrong. Once you supply an accurate inventory with the probate application, everyone will be happy and the correct taxes or exemptions will be applied.

The officials in the probate office are very helpful, they're not out to trip you up and as long as they see they you are an honest broker and have not messed up the paperwork, they will help you ensure that you have everything covered.