10 April 2018
Have you done an asset search?
A personal representative is a generic term to describe an executor or administrator of an estate. An executor is usually appointed through a will and an administrator is usually someone who obtains a grant of representation when someone passes away without a will.
Most of our clients would like to keep the costs of estate administration as low as possible and would like to achieve the conclusion of the estate administration as quickly as possible.
Personal representatives have a duty to properly administer the estate which extends to collecting in all of the estate assets and settling all liabilities of the estate. Sometimes, there will be estate assets that the personal representatives do not know about and may not necessarily find out about by reviewing paperwork to which they have access to. Therefore, it is best practice for personal representatives to do some form of asset search using a search provider as these searches can often locate assets that the personal representatives may have otherwise missed.
An asset search will notify several financial institutions about the deceased’s death and compile a report of any unknown assets found. This tool is important because a personal representative will have to submit an inheritance tax return to HMRC confirming the net and gross values of an estate. If a personal representative provides incorrect values on the inheritance tax return, HMRC have the discretion to issue penalties and correcting the account could cause delay to the estate administration, not to mention extra legal costs if a solicitor is assisting with the estate administration.
If foreign assets are uncovered, there can often be country specific procedures for realising such assets which could cause delay to the estate administration if the personal representatives do not find out about the assets in sufficient time to properly deal with them.
Finally, if an unknown asset comes to light after the estate administration has concluded, regardless of the length of time that has passed, the personal representatives of the estate will still have a duty to deal with those assets and distribute them to the rightful beneficiaries. If an estate asset comes to light several years after the personal representatives concluded the estate administration, there could be an array of issues that present themselves.
If you are a personal representative of someone’s estate and you want some further guidance about assets searches or general estate administration, please do not hesitate to contact us on 01531 632377.