Everything You Need To Know About Letters of Administration

If you already know the background information and want a quick shortcut to your options on the best way to obtain Letters of Administration please follow these links:

1. Click here if you want to obtain Letters of Administration yourself without a solicitor.

2. Click here if you want help obtaining Letters of Administration from a legal professional.

What exactly are "Letters of Administration"?

Well, firstly, it is important to note that a Grant of Letters of Administration is a type of court order issued by the Probate Registry (which is part of the High Court). It is not a letter that is written in the traditional sense.

Why are Letters of Administration required?

A Grant of Letters of Administration is required to legally establish who can collect money from banks, building societies and other organisations which hold assets belonging to the deceased person. 

Once Letters of Administration have been obtained, the deceased person's assets can be accessed, cashed-in or transferred to the beneficiaries of the estate in accordance with the intestacy rules (see yesterday's email for details). Without Letters of Administration, the deceased person's assets will be "frozen" indefinitely.

Letters of Administration are not usually required where:

1. An asset (e.g. a bank account) is held jointly with someone else. In these circumstances the bank account would simply be changed into the name of the survivor. This is also the case with a jointly owned property.
2. The assets owned by the deceased are valued at less than £5000.

What's involved with obtaining Letters of Administration?

Obtaining Letters of Administration involves completing legal documents and forms, attending an interview at the Probate Registry (part of the High Court) and completing inheritance tax paperwork (even where the estate is valued below the inheritance tax limit).

It usually takes between 3-4 months to obtain the Letters of Administration and then about the same time again to complete the procedures that are required to finalise the estate after Letters of Administration are obtained.

The person applying for the Letters of Administration is legally and financially liable for ensuring the estate is dealt with correctly. Any errors will have to be put right out of their own pocket.

Due to the amount and nature of the work involved, most people choose to get legal representation to obtain letters of administration on their behalf, unless the estate is of a modest value (typically less than £30,000) when it may be more cost effective to consider a "DIY" approach.

Obtaining Letters of Administration involves these steps:

1. Notify in writing all interested parties of the death.
2. Value the deceased person's estate (all of their assets minus debts).
3. Complete the inheritance tax return and pay any tax due (note: a return must be submitted even if there is no tax to pay).
4. Complete the Letters of Administration legal paperwork including the court application form and submit this to the Probate Registry.
5. After obtaining Letters of Administration, close the deceased's bank accounts, sell investments, transfer/sell property etc.
6. Pay any debts due.
7. Place statutory notices in accordance with the Trustee Act.
8. Prepare estate accounts detailing the financial transactions on the estate.
9. Distribute the money/assets to the beneficiaries in accordance with the "Intestacy Rules".

Of course, there is a lot more to it than that and I couldn't possibly lay out the entire process on a webpage. The above steps are to give a brief outline of the steps involved.

Your options - How To Obtain Letters of Administration

There are 2 options available:

1. The “DIY” approach. You deal with all of the paperwork and legal procedures yourself. This is the most cost effective option, but also the most risky (you are personally liable if you make any mistakes) and the most time consuming (there is a lot of paperwork and form filling and requires attendance at court). Further information can be found here:
http://www.diyprobateforms.co.uk/letters-of-administration-long/

Or

2. Get Legal Representation to obtain Letters of Administration on your behalf. This costs more (starting at £295 + VAT), but it will save you time and hassle and is the least risky approach. You can find out more about this option here:
http://www.diyprobateforms.co.uk/loa/

There isn't a "right way" or a "wrong way" as such, it is usually down to the personal preference of the person responsible for dealing with the estate. It often comes down to the fact that most people either don't want to take on the responsibility and financial liability that comes with dealing with an estate or they simply can't find the 30-40 hours that it takes.

If you are unsure about which option is right for you or if you would like to find out how we can help you please call our free helpline 0800 612 9150 or complete the form on the right.