PAIP form

[Villaboy]

I am completing the PA1P form as executor of my aunt's estate.
Can somebody explain the difference between gross and net values for IHT and gross and net values for probate?

[Sam101]

As far as IHT is concerned, if your Aunt has an estate below the IHT level AFTER allowances (net and gross) then Probate is not needed for anyone dying after the 1st January 2022.

The allowances are £325,000 before inheritance tax is payable, if she owned her home, then she also has a residential allowance on £175,000, so £500,000 in all. If she was married and her husband died first, then HIS allowances are also available if they have not been used.

A married couple therefore have allowances of £1,000,0000 between them before any inheritance tax is payable.

If she, or he if a husband made gifts in excess of there normal allowances then those gifts may reduce the allowances.

I hope this helps, but do ask more questions if you wish to help you administer your Aunt's estate.
Sam

[Villaboy]

Thanks for the reply. The estate is under the IHT allowance thanks to using her late husband's allowance but banks and building societies say I need probate
I am struggling to answer the questions on the PA1P form regarding gross and net values.
The question regarding IHT values is straightforward after using the IHT checker tool but I do not know what to put for the probate gross and net values, are they not the same?

[Sam101]

This is information you require: The net value is all assets, including sole or joint assets, gifts, or an interest in a Trust, added together with liabilities taken away. Joint assets need to be reported for IHT purposes, but probate is not required as they pass by survivorship.

Although a Probate application is not needed as I have mentioned, some financial institutions will request Probate as it is in accordance with their rules. However, those rules may not have taken account of the change in the law from death after 1st January 2022. Contact them and explain the changes and that, if appropriate in your case, Probate is not required, so how do they propose to be able to deal with the matter

[des8]

Financial institutions each have their own limitson how much cash they will release to executors without sight of a grant of probate.

These were the 2020 limits,

• Aviva - £50,000
• AXA - £10,000
• Bank of Ireland - £10,000
• Bank of Scotland - £25,000
• Barclays - £50,000
• Birmingham Midshires - £25,000
• Britannia - £30,000
• Cheltenham & Gloucester - £25,000
• Co-op Bank - £30,000
• First Direct - £20,000
• Halifax - £50,000
• HSBC - Decided on a case-by-case basis
• Lloyds TSB - £50,000
• M&S Money - £15,000
• Nationwide
  • Under £5,000 - no grant of probate is required
  • £5,000 - £30,000 - a certified copy of the grant of probate is required, or alternatively the 'close account' form will need to be witnessed by a solicitor
  • Over £30,000 - the original grant of probate is required
• Natwest - £25,000
• NS&I (National Savings / Premium Bonds) - £5,000 to £15,000 depending on the will and the number of executors
• Post Office - £10,000
• Royal Bank of Scotland - £25,000
• Sainsbury's Bank - £20,000
• Santander - £50,000
• Skipton Building Society £15,000
• Tesco Bank - £25,000
• Woolwich - £15,000
• Yorkshire Building Society - £30,000

It’s worth noting that even if the estate is below the probate threshold, (used to be accepted for a small estate upto £5,000) a financial institution can still request that a grant of probate is obtained. This is common where there is a complex family situation or a large estate.