Need for a grant Flashcards
(8 cards)
why is a grant needed?
it is proof that those named in the GOP (the PRs) are entitled to collect in the assets of the deceased from the asset holders (this is not proof of death and a death certificate is also usually required)
what is meant by ‘devolution of assets’?
the passing of property from the deceased to the PRs
when do executors and administrators (respectively) have authority from?
- Executors have authority immediately from death
- Administrators’ authority commended from the GoLA
what assets can be administered without a grant? What is the advantage of this type of property?
o Personal assets
o Cash
o Up to £5k from a National Savings & Investment product, friendly society etc (this is at the bank’s discretion. They may insist on seeing the GOR)
If estate only consists of these there is no need to apply for a grant, or it could be used to pay IHT liabilities
which assets typically do not devolve to PRs?
- Joint property
- Life policies
- Pension scheme benefits
- Trust property
when will a life policy not devolve to the PRs?
If the life assurance policy is either:
Written in trust for the benefit of specified Bs; or
Transferred to named Bs
…it no longer belongs to the policy holder + so wouldn’t form part of their estate
when will a pension benefit devolve to PRs and when will it not? give an example of such a benefit
Employee can usually give letter of wishes indicating who the benefit should be paid to on their death. Not binding but pension fund trustees usually comply.
This benefit doesn’t belong to the employee so is not part of their estate
However, some schemes state the benefit must be paid to the PR, then it would be distributed in accordance with the Will / intestacy rules
Example: lump sum if employee dies
when will trust property devolve to PRs and when will it not? give an example
This depends on their interest, i.e.:
o Bare trust (i.e. B entitled to income + capital) = forms part of estate
o Life interest (i.e. B only entitled to income) = not part of D’s estate - devolves according to terms of the trust
e.g. trust created for husband for life, remainder to children. Husband dies. His life interest passes to the children.
