Part 5: Looking beyond inheritance tax

Inheritance tax is understandably where many advisers first encounter estate advances. It has a fixed deadline, the sums involved can be significant and the consequences of failing to pay on time are well understood. If an estate doesn’t have enough available cash to meet that liability, it’s entirely natural to start looking for ways of bridging the gap. I’d simply encourage advisers, however, not to stop the conversation there because, once you begin thinking about estate advances as a way of addressing temporary liquidity pressures during probate, you start to see situations that have very little to do with inheritance tax itself.

Property is probably the clearest example. We regularly work with estates where the family home would benefit from renovation or improvement before it’s marketed. Executors can often see that investing in the property is likely to increase its eventual sale value, but the estate doesn’t have the available cash to carry out the work. Rather than accepting a lower sale price or feeling pressured into selling more quickly than they’d like, an estate advance can provide the liquidity needed to maximise the value of the estate for the beneficiaries.

The same principle applies to many of the practical costs that arise while an estate is being administered. Professional fees, outstanding liabilities and other legitimate estate expenses often need to be settled long before assets can be realised. Those obligations don’t disappear simply because probate is still underway, and dealing with them promptly can often help the administration of the estate progress more smoothly.

The perspective changes again when the client is a beneficiary rather than an executor. At that point, I’m no longer thinking primarily about funding the estate. I’m thinking about what waiting is costing the individual. They may be delaying a property purchase, putting investment plans on hold, carrying expensive borrowing or simply postponing decisions because they assume nothing can happen until probate has been completed.

That’s usually where the conversation shifts. Rather than discussing estate or inheritance advances directly, I’m asking whether waiting is driving decisions that the client wouldn’t otherwise choose to make. If it is, it’s worth exploring whether another option might allow them to stay closer to the plans they originally had.

I also think it’s important for advisers to remember that they don’t need to decide which type of advance may be appropriate before introducing a client to us. That’s our role. Their role is to recognise that there may be a better option than waiting or making financial decisions that are being dictated entirely by timing. Once we understand the client’s circumstances, we can recommend the most appropriate solution and explain it directly to them.

I’ve found that once advisers begin looking at estate and inheritance advances through that broader lens, they stop seeing them as specialist products designed primarily for inheritance tax. Instead, they begin to recognise them as practical funding solutions that can help clients navigate a wide variety of situations during probate. The products themselves haven’t changed. What changes is the way advisers think about the problems they can solve.

A valuable addition to the advice process

Looking back over the many conversations I’ve had with advisers over the years, I’ve come to believe that some of the most valuable conversations they have with clients are the ones their clients never expected to have. People generally know they can speak to their adviser about pensions, investments, mortgages and tax planning because those have always been part of the relationship. Estate and inheritance advances are different. Most clients have never heard of them, so they’re unlikely to ask whether they’re an option. If the conversation happens at all, it almost always starts with the adviser.

That’s where I think advisers create genuine value. Not by recommending a particular product, but by making clients aware that they have a choice they didn’t know existed. Sometimes the right decision will still be to wait for probate to run its course. In many cases, that will be exactly the right outcome. Good advice has never been about steering every client towards the same solution. It’s about helping people understand the options available to them and supporting whichever decision best fits their circumstances.

That’s also why I don’t think advisers need to become experts in estate or inheritance advances before raising the subject. Their expertise lies in understanding their clients, recognising when timing is beginning to influence financial decisions and identifying where additional support may improve the outcome. Our expertise is helping clients understand whether an estate or inheritance advance is appropriate and guiding them through the process if they decide to proceed.

For me, that’s where estate and inheritance advances sit within the advice process. They’re not a replacement for careful estate planning, nor are they something every client will need. They’re simply another option advisers can draw upon when the circumstances are right. Making clients aware that option exists, recognising when it may genuinely help and introducing it at the appropriate time allows advisers to strengthen relationships, solve problems that might otherwise have seemed unavoidable and demonstrate the value they bring at some of the most important moments in their clients’ lives.

Part 1: Why advisers miss referral opportunities

Part 2: Start by understanding your client’s role

Part 3: Recognising when timing becomes the issue

Part 4: Setting realistic expectations about probate

Part 5: Looking beyond inheritance tax