What happens on your death if you lived abroad but still had assets in England and Wales?
With an ever-increasing number of Brits opting to move abroad, it’s more and more common to come across a situation where a person dies overseas but leaves assets in the UK.
In these circumstances, there are special procedures involved for the administration of the UK assets.
So, how do we deal with the assets in the UK?
Even if the administration of the estate has been undertaken in the deceased person’s home country overseas, it may still be necessary to obtain a document called a Grant of Probate or Letters of Administration in the UK.
However, it’s unlikely such a Grant will be required if the deceased’s assets in the UK are valued at under £5,000, in which case UK banks and building societies will usually hand over the assets on receipt of a death certificate and the Will, if any.
In addition, if an asset was jointly owned it may pass automatically to the co-owner and a Grant may not be necessary.
But a Grant will always be required in order to access shares held in UK companies, however small the holding.
So, if you are an executor or administrator of the Will – or in the case where there is no Will, a beneficiary – you will have to seek the help of a solicitor in applying for the Grant.
What will I need to apply for this special Grant?
Your solicitor will need the following:
- Details of the deceased’s domicile
Your solicitor will require full details of the deceased’s ‘domicile’. This is relevant for UK tax purposes.
Domicile is a concept unique to the UK. Everyone has a domicile of ‘origin’ that is usually that of their father. Above the age of 16, an individual can have a domicile of ‘choice’ whereby they choose to reside in another country, with the intention of making it their permanent home and, in effect, ending their days there.
To establish the deceased’s domicile your solicitor will require information on:
- where and when the deceased was born;
- the domicile and nationality of the parents;
- dates and details of any moves between different countries and reasons, eg periods of education or employment; and
- where and when the deceased died.
- The Will
Your solicitor will require the original Will unless it has already been submitted for probate in the deceased’s home country. In this case you will need to provide a court certified copy.
If the Will is not in English you will need to get a translation, verified by an English notary public or a British consul.
Your solicitor may also require an affidavit of law stating that the Will is valid in the home country.
If there is no Will, you will need to provide an affidavit of law setting out who is entitled to the deceased’s assets under the law of the home country. Your solicitor will also need details of all the surviving relatives, including spouse, children, grandchildren, siblings and parents.
- Overseas Grant
If the Will has been proved in the deceased’s home country then the persons appointed by the Court are usually entitled to apply for the UK Grant. If the home country is a Commonwealth country it may be possible ‘reseal’ the overseas Grant and this will simplify the process.
- Assets
Your solicitor will require full details of the deceased’s assets in the UK and their world-wide assets.
What about Inheritance Tax?
For non-UK domiciled individual, UK inheritance tax is due on all UK situated assets above the ‘nil rate band’ (currently £275,000).
But there are exceptions to this. If inheritance tax has been paid on the deceased’s UK estate in the home country, depending on the country, it may be covered by a ‘double tax treaty’ which will prevent such tax having to be paid twice in the two countries.
In addition, UK inheritance tax may not be payable if one of the inheritance tax exemptions apply, such as transfers to spouses or to charity, or of certain business or agricultural property and certain government securities.
What happens once my solicitor has all the required information?
Once your solicitor has the relevant information from you, he or she will:
- complete the Inland Revenue account and arrange for any UK inheritance tax to be paid;
- apply to the Probate Registry for the Grant; and send the Grant to the relevant banks, building societies or share registrars. The assets can then be released to the person named on the Grant and distributed to the relevant beneficiaries.
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