When someone passes away it is the responsibility of the executor(s) of their will to manage their estate according to their wishes. This will mean that they will have to collect and administer their estate before passing it on to their beneficiaries. What happens though when that estate, and the wishes set out in the will, include shares? This month we focus on shares included within a will and how to go about valuing and distributing them.
What are the types of shares that can be included in a will?
There are a number of types of shares that a person may hold, including:
- Listed shares – in other words, those issued by a company that is listed on one of the stock markets
- Premium bonds
The first step for the executor(s) is to determine what shares the deceased held and where they are kept. If there is no detailed information in the will itself, good places to look for share certificates would be with their personal and financial paperwork. Alternatively, they may be stored with a solicitor, bank, accountant, or investment broker.
Once all listed shares have been compiled the next step is to get them valued. The value of each share will be the closing price on the date the person passed away. Using that unit price and multiplying it by the number of shares for that particular company – this could be anything from one to hundreds of shares – will give you the total value of that stock. This must be done for each individual company in which the deceased held shares.
ISAs and premium bonds
As with shares, the value of an ISA will be its total value on the date of their death. This can be obtained from the financial institution in which the ISA was held. If the ISA is part of a wider investment portfolio then the fund managers will be able to provide valuation details.
Premium bonds can be valued by the NS&I. The more information you can provide, the easier the process will be. This can include Passbooks, Certificates, or Bonds which should be help with the deceased’s other financial paperwork. The NS&I has a tracing service that can be used if no paperwork can be found.
While you may not have to begin the valuation process immediately, keep in mind that the process can take months or even longer for more complex estates. The process does need to begin straight away though if the estate owes any inheritance tax. Inheritance tax forms need to be submitted within a year and tax must begin to be paid before the end of six months. This can be done even if the valuation process has not yet been completed.
Remember that as an executor you do not have to manage this process on your own; you are free to hire a solicitor or probate specialist to help you with valuation, submission of paperwork, and distribution of assets on completion of the valuation.
For advice and assistance on anything related to probate or will preparation our specialists at IWC Probate Services are on hand to help. Feel free to get in touch with any questions or to make an appointment at any time. You can find us on 020 8017 1029 or at firstname.lastname@example.org.