Probate

What is Probate

Probate is the entire process of applying the Court for approval to administer a deceased person’s estate. It involves organising their money, assets and possessions and distributing them as inheritance – after paying any taxes and debts.

It is a legal process where a will is reviewed to determine whether it is valid and authentic. Probate is required to validate a deceased person’s will in order for their wishes to be carried out by an executor named in the will.

What is the process?

Every estate and every Will is different. The exact probate process can vary depending on the instructions left in the Will and the assets, creditors, and beneficiaries the estate has.

The basic process for an executor is:

  1. Gather the full details of the estate’s assets and debts
  2. Apply for Grant of Probate (permission to administer the estate and pass out inheritance)
  3. Complete an inheritance tax return and pay any tax due
  4. You receive a Grant of Probate
  5. Repay any of the deceased’s outstanding debts
  6. Distribute the rest of the estate according to the instructions left in the Will.

Probate ends once all taxes and debts have been paid and all inheritance passed on.

Why is it needed?

Probate may be required when a person has passed away and leaves behind certain kinds of assets. For example, if there is money in a bank account and the deceased was the sole account holder, the financial institution may ask for a grant of probate before they will release the funds to the executor. A grant of probate is only required for funds if the value is above a certain amount. Every financial institution will likely have policies around deceased estates and their handling, so it’s best to inquire based on your circumstance.

Other scenarios where probate might be necessary includes:

  • If the person passed has many shares with a company, they might require a grant of probate.
  • If the person who passed was the sole owner of real estate, a grant of probate might be necessary to transfer ownership. If there are two owners, then the ownership is transferred to the second person.

Applying for probate may also be appropriate in other circumstances – if a person’s will is contested, for example.

Who can apply?

If you are named as an executor in a will, you should apply for a Grant of Probate at the Supreme Court of NSW within six months from the date of death of the deceased, unless there is a reasonable explanation for the delay. The person or persons applying for a grant of probate must be an executor appointed under the will and over the age of 18 years. If the applicant is not the instituted executor the conditions for being appointed as a substituted executor must have been met.

What happens if you don’t have a will?

Without a will, you run the risk of dying ‘intestate’, and your assets being distributed to your next of kin according to the rules of intestacy. This may include surviving relatives you may not have chosen to inherit your assets. If this happens, an application needs to be made to the Supreme Court for ‘Letters of Administration’ – a document providing the court’s formal approval for someone to administer the estate of the deceased.

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