Written by Lynton Stock, a senior partner at Shelley Stock Hutter (SSH)
IN 2014, the ICAEW received final approval to regulate probate services. Yet since then, how many accountancy firms have pushed ahead to set up a probate service ?
As long as I can remember the professional of choice to deal with probate has always been the lawyer. This has always made little sense as when dealing with the numbers and the assets of an estate naturally people should be turning to their accountants – as they will often have the information required to start the probate process.
The reality is that the lawyers dealing with the cases would turn to the accountants anyway for much of the information required. The institute recognised this and has provided the platform for members to apply for a licence.
For uncontested probate cases, clients should be turning to their accountants and not their lawyers and cutting out the middle man. But why are accountants better equipped than lawyers to assist?
- Let’s say the deceased is a client of your firm – as the accountant you will have on record a lot of the important financial information on file about him/her so that saves family dealing with the probate both time and cost. Remember professionals charge by time so if the information is readily available and does not need review this is going to significantly reduce time and cost.
- Most probates proceed on an uncontested basis and the process of dealing with probate is very much a financial exercise – something which accountants have been trained for. Currently accountants are not legally allowed to deal with contested probates – although this could change in the future.
- Valuing the estate often requires input from accountants even if the probate is handled by a firm of lawyers. This involves engaging two separate professional firms – potentially duplicating work and increasing time costs. Probate and inheritance tax go hand in hand and accountants are used to dealing with all the specifics of IHT, as well as other taxes. For example, completing and submitting form IHT 100 to HMRC will cover numerous questions which a lawyer will often need to take advice on from an accountant eg share valuation work.
- Accountants are likely to be much more cost competitive. They will almost always charge on an hourly basis and not on the value of the deceased estate and their charge out rates historically are considerably lower than a lawyer.