We can’t know when we will suffer ill health or someone will die, but we can all think ahead in certain situations to reduce the delay – and stress – that not planning ahead sooner can cause.
Take grants of probate, for example. Once someone dies, the executors need to gather details of the deceased’s assets and liabilities so it can take time to get valuations and make enquiries. But if matters are left to drift, the fact that it is currently taking 16 to 24 weeks or longer from lodging the application for the grant to receiving it, can cause real issues.
Will the sale of a property be lost when the buyer won’t wait six months from agreeing the sale to you receiving the grant?
It is always difficult to know when to put a house in an estate on the market, but the sooner you submit the application for the grant, the better it is, as you’ll have the grant through sooner and can therefore be ready to exchange sooner, subject to agreeing all the usual sale points.
Delays in receiving the grant can cause issues with houses when they are empty over the winter period and burst pipes go un-noticed causing damage, or the house is simply broken into whatever the time of year. We had one estate where all the pipes and electrical wires were stripped out as the metal had a high value. It took some work and expense to get the property saleable again.
Can the corporate deal wait four to six months when all the other parties have signed and are ready to complete?
The sooner the grant is applied for – using estimates for figures if necessary, pending more precise valuations of assets – the sooner it will be received and the deal can then move on.
Inheritance tax becomes due six months after someone dies and then after that period, interest starts to accrue on the unpaid inheritance tax. So, to prevent or lessen the interest, the inheritance tax should be paid and the grant application made as promptly as possible, ideally within that time limit.
What about Finance Lasting Powers of Attorney (FLPAs)?
FLPAs can’t be used until they are registered with the Office of the Public Guardian. If you are sensible and have appointed finance attorneys for when you want them to act – that long holiday abroad when documents need to be signed – or when they have to act – sudden ill health renders you too unwell to run your business – it will cause untold stress and problems if the FLPA then has to be registered. We are seeing LPAs regularly taking four to five months to come through the registration process. Attorneys not being able to act in a time of crisis is far from ideal so apply for registration of LPAs while there’s no need for them to be used and then the solicitor can hold the original registered LPA so it can’t be used until it is desired or necessary. Only when it is needed, the registered FLPA can be retrieved and the attorneys can act as required immediately.
The government are trying to address the increasing delays at the probate court and the OPG with more staff being recruited, procedures being streamlined or changed and the further use of technology, but still the sheer number of weeks it takes to receive the grant or the registered FLPA, means prompt action should be taken to apply for it as soon as possible to minimise the consequences of the delay.
Why make stress where it isn’t needed? Think ahead and get the documents lined up to minimise or avoid unnecessary issues.