What is Probate and is it necessary when administrating an Estate?
When someone dies it is often left to a close friend or family member to be the executor of a deceased’s estate and due to their close relationship, the executor can find this a very challenging time emotionally.
The role of the executor is even more difficult in South Australia now as the courts have temporarily ceased processing all grants of probate. They have done this as they are in the process of transitioning to an online system which should be a marked improvement from the old system.
This has held up the distribution of all estates requiring probate since early September and it is likely they will be on hold until early 2019.
Not all estates will require a grant of probate for the executor to distribute the assets. For example some institutions may not require probate to release small holdings i.e. a share holding of less than $25,000 or a bank account with a balance of less than $50,000 (depends on provider).
However, nursing homes and the land titles office would require a grant of probate to release an asset. This could mean some estates are stuck in limbo for months and the estate must pay ongoing costs to maintain assets they can’t sell. Beneficiaries must also put their lives on pause while they wait.
Obtaining a grant of probate has long been an issue in South Australia with some of the longest wait times nationally and the highest fees. The new system is hoped to reduce the time to process but there has been no mention to a reduction of fees. Currently an estate between $500,000 to $1,000,000 will cost $2,125 and over $1,000,000 costs $3,187 for the application of a grant of probate.
In the past have we recommended using a solicitor to ensure the smoothest passage of a grant of probate with the avoidance of any delays due to red tape. This has further added to the cost of the process but hopefully the new online system is easier to administer giving executors a less stressful experience.
If you are having difficulties with the duties of acting as an executor and need assistance, please contact your adviser.