Dealing with a share portfolio is often the slowest part of administering an estate. Unlike bank accounts, which can be closed relatively quickly, shares require a specific, multi-stage process to satisfy HMRC and the Registrars.
Here is the professional workflow for handling shares during probate.
Step 1: The “Date of Death” Valuation Before you can apply for a Grant of Probate, you must value the estate for Inheritance Tax (IHT).
- The Rule: You must use the closing price of the shares on the day the person died.
- The Calculation: This is usually the “quarter-up” price (the lower price plus one-quarter of the difference between the lower and higher price) OR the average of the highest and lowest marks.
- Warning: Simply Googling the share price on that day is often inaccurate for HMRC purposes. You need a verified historical data source.
Step 2: Verification of Holdings You cannot rely on the certificates found in the deceased’s home. They may have sold the shares years ago, meaning the certificates are invalid. You must write to the Registrar (Equiniti, Computershare, or Link) to confirm the current holding and ask for a list of unclaimed dividends.
Step 3: The “Small Estates” Limit For holdings under a certain value (often £5,000–£20,000 depending on the registrar), you may not need a full Grant of Probate. You can use the “Small Estates” procedure, which is faster and cheaper.
- Action: Always ask the registrar for their specific “Small Estates Limit” before paying for a full Grant.
Step 4: The Transfer Once Probate is granted, you have two choices:
- Transfer: Move the shares into the beneficiaries’ names (requires a Stock Transfer Form).
- Sell: Use a postal dealing service to sell the shares and distribute the cash.
Automate the Process Valuing a portfolio of 20+ stocks manually can take hours. Divica Pro allows you to bulk-upload a list of companies. We instantly provide the Registrar details and can help generate the Date of Death valuation data you need for IHT forms.