When someone dies, attention quickly turns to the practical question of who receives what.
Personal possessions, from jewellery and furniture to family heirlooms and collections, are often the items with the greatest sentimental value and the ones most likely to cause misunderstanding if handled incorrectly.
The rules around distributing personal possessions during the probate process are more specific than many people realise and acting too quickly can create real problems for the executor or an administrator.
Nothing can be distributed before probate is granted
This is the most important rule and the one most commonly overlooked. Until the Grant of Probate or Letters of Administration has been issued by the Probate Registry, the executor has no legal authority to distribute any part of the estate, including personal possessions.
That means that even if a Will clearly states who should receive a particular item, that item cannot lawfully be handed over until the grant is in place.
Doing so before then can expose the executor to personal liability if the estate is later found to have debts that cannot be met.
Debts and liabilities come first
Before any assets can be passed on, the estate must be checked for outstanding debts, taxes and liabilities.
Personal possessions form part of the estate and where the estate is insolvent or borderline, they may need to be sold to meet those obligations rather than passed to beneficiaries.
Executors should, therefore, resist any pressure to distribute personal items early, even from close family members, until they are satisfied that the estate can meet all of its obligations.
Following the Will’s wishes
Where a Will contains specific gifts of personal possessions, those instructions must be followed, provided the estate is solvent and probate has been granted.
If an item named in the Will no longer exists or cannot be located, the gift is said to have adeemed and the beneficiary will generally receive nothing in its place, unless the Will specifically provides for this.
Where the Will contains a general gift of personal possessions to a group, such as to children equally, the executor may need to agree on a method of division with the beneficiaries.
If they cannot agree, the executor has the power to decide, though involving the family in a fair process tends to reduce the risk of disputes.
As a side note, it is becoming increasingly common for people to leave Letters of Wishes alongside a Will.
This is a private, non-binding document that accompanies your Will or a trust to guide executors, trustees and loved ones.
This may include the rationale behind a person’s decisions, which can prove useful, but does not carry the same legal weight as a Will.
What happens if there is no Will?
Where the deceased died intestate, i.e. without a Will, personal possessions pass according to the rules of intestacy in the same way as other assets.
This focuses on financial, rather than sentimental value and means that a spouse will receive personal possessions up to a value of £322,000 and half of the remaining estate.
The other remaining half above this amount will be passed to all surviving children.
If the person has divorced and not remarried, the estate is divided equally among all surviving children.
Where a child who would have benefited is also deceased, their share passes on to their own Children, if they have any.
The administrator has no authority to act on informal wishes expressed by the deceased, however, well-known they may have been to the family.
This can be a source of real disappointment for beneficiaries, particularly where a deceased person had made their wishes clear informally but never formalised them in a Will.
It is a reminder of how important it is to keep a Will up to date.
Items of value must be accounted for
Executors have a duty to account for all assets in the estate, including personal possessions of value.
Items, such as jewellery, antiques, art and collections, may need to be formally valued for probate purposes, both to establish the correct Inheritance Tax position and to ensure that beneficiaries receive their fair share.
Simply handing out items without considering their value or allowing family members to take things informally before probate can leave the executor exposed to claims from other beneficiaries or creditors.
Here to help
As accountants authorised to carry out probate work, we can help you navigate the administration of an estate with confidence, from the initial valuation of assets through to the final distribution to beneficiaries.
