Under confirmation, you fill in Form C1. Essentially, this form fulfils the same role as Forms PA1 and IHT 205 in England, Northern Ireland and Wales. Form C1 establishes the details of the deceased, the executor and the contents of the estate and their value.
Form C1 asks if the estate is excepted (exempt from having to submit a fill account and therefore, in effect, free from inheritance tax). In order for an estate to be excepted, it has to fulfil the following conditions:
The deceased lived in the UK at the time of death.
The estate before deduction of any debts or gifts is worth less than the threshold for inheritance tax (£312,000 from April 2008).
The estate is worth less than £1,000,000 but passes to the deceased’s spouse or civil partner – who must be living in the UK – or to a charity.
Assets held outside the UK are not worth more than £100,000.
The deceased had not made any substantial transfers within seven years of their death
If none of the above conditions apply, then move on to fill in Form IHT 200.
The excepted state rules are a bit of a minefield. If you’re at all unsure as to whether the estate is excepted or not, contact your local tax office for clarification.
Confirmation forms are available from the Sheriff’s Clerk Office or the Sheriff’s Court in the area the deceased lived in at the date of death. These can be found in the Yellow Pages or online.
If the estate is worth less than £25,000, you can obtain confirmation under the Small Estates Act. Ask the Sheriff’s Clerk to prepare the Form C1 for you. For more details on dealing with small estates in Scotland, check: www.scotscourt.gov.uk.
Send completed confirmation forms to the Sheriff’s Clerk of your local Sheriff’s Court along with a copy of the Will, if there is one. As with probate, obtaining confirmation incurs a fee. Pay this fee from any money held in the Executor’s account. This fee is waived for estates worth less than £5,000. A few weeks after submitting your application forms, you should receive your confirmation forms and any extra copies you may have requested. You are now free to deal with the deceased’s estate.
Bond of Caution
If no will exists and you apply for confirmation, you may have to obtain a Bond of Caution. A Bond of Caution is a guarantee given by an insurance company that you will distribute the estate in accordance to intestacy and not try to benefit yourself. Of course, an insurer won’t simply issue a Bond of Caution gratis; sometimes it can cost several hundred pounds to obtain. If you’re the spouse of the deceased administering the estate, then you won’t need a Bond of Caution. This is because under Scotland’s intestacy rules, the spouse is most legible to obtain the majority of the assets anyway, giving less reason for fraud.