• A person’s estate is made up of everything they owned, as well as their debts at the time of death, including property, savings, personal items, taxes and business interests.
• However, some assets, especially if they sit in a trust, can sit outside of an estate.
• Working out exactly what’s in an estate is often the first step in spotting whether there’s enough cash available to pay bills like Inheritance Tax. If there isn’t, this is where Provira’s Estate Advance can help.

When someone dies, everything they owned and owed becomes part of their estate. That includes the obvious things, like a house or savings account, along with debts, business interests and personal items that might not feel like “assets” at all.

Before anything can be passed on, someone has to work out exactly what’s in the estate, what it’s worth and whether any debts need to be paid off. 

The executor needs to know all of this before they can work out whether Inheritance Tax is due and what will eventually be left for the beneficiaries.

Knowing what’s actually in an estate is also the first step in spotting a problem that catches a lot of families out. On paper, an estate can look like it has a lot of value. In reality, most of that value might be tied up in a house or a business, leaving very little cash to pay bills like Inheritance Tax.

What is an estate when someone dies?

An estate is the legal term for everything someone leaves behind when they die. Despite the name, it doesn’t just mean their house or land.

It can include savings, investments, cars, jewellery and stocks, alongside anything they still owed. The executor named in the will, or an administrator if there isn’t one, is responsible for working out what all of this is worth.

What is included in a person’s estate?

A person’s estate normally includes:

Property

This includes the person’s main home along with any other property they owned, like a second home, rental property or land, whether in the UK or abroad.

The property is valued as part of the estate, while any outstanding mortgage is counted separately as a debt.

Financial assets

Money held in bank and building society accounts forms part of the estate, along with savings and investments like ISAs, stocks, shares, premium bonds and cryptocurrency. 

Personal items

Personal items can form part of the estate too, from cars and jewellery to art, furniture and electronics. Some of these things might hold more sentimental value than financial value, but they still need to be noted when the estate is being valued.

Business interests

If the person owned a business, or held shares in one, that interest can become part of the estate.

Exactly what gets passed on will depend on how the business was set up. It could mean passing on full ownership, a share of the company or the value of that interest to the beneficiaries.

Are pensions and life insurance included in an estate?

Pensions and life insurance don’t always form part of the estate, it depends on how they’re set up.

Most pensions are currently held in a trust, which means the pension provider, rather than the will, decides who gets the remaining funds. Because of this, pension money will often pass directly to whoever the person nominated rather than being distributed through the estate.

However, that’s set to change. From 6 April 2027, most unused pension funds and death benefits will be brought into the estate for Inheritance Tax purposes.Read our full guide on the pension changes here.

Life insurance can work in a similar way. A policy written in trust can pay directly to the named beneficiaries rather than into the estate. If it wasn’t written in trust, the payout may go to the estate instead and could affect its Inheritance Tax.We cover this in more detail in our guide to life insurance and inheritance.

Are jointly owned assets included in the estate?

Jointly owned assets are slightly different. What happens after one owner dies depends on whether they owned the asset as joint tenants or tenants in common.

If an asset was owned as joint tenants, the deceased person’s share passes automatically to the surviving co-owner. It doesn’t pass under the will, although its value can still be relevant when working out Inheritance Tax.

If it was owned as tenants in common, each person’s share is treated separately. The deceased person’s share becomes part of their estate and is distributed according to their will rather than passing automatically to the other owner.

Our guide on jointly owned assets explains the difference in more detail.

What is not included in a person’s estate?

Not everything someone leaves behind will necessarily pass through their estate. Assets held in certain trusts, some pension benefits (until April 2027), life insurance written in trust and property owned as joint tenants may pass directly to someone else instead.

An asset not passing through probate doesn’t automatically mean it’s ignored for Inheritance Tax. Jointly owned property, for example, can still affect the estate’s taxes even if ownership passes automatically to the surviving owner.

How is the value of an estate calculated?

An estate’s value is calculated by adding up everything the person owned and then subtracting what they owed. What’s left is known as the net estate.

Property, business interests and other valuable assets may need professional valuations. Cash in bank accounts and investments is usually easier because the balance will stay the same from the date of death.

Once everything has been added up, debts are taken off the total. This can include mortgages, credit card balances, loans, unpaid bills and funeral costs.

Here’s an example. Say someone’s assets add up to £620,000: a house worth £450,000, £40,000 in savings, a car worth £15,000 and a £115,000 share in a family business. 

Once a £100,000 mortgage and £20,000 in other debts are deducted, the net estate comes to £500,000.

That £500,000 might look like a healthy sum on paper, but very little of it is sitting in cash. If there’s then an Inheritance Tax bill to pay, the executor can be left with a valuable estate but very little accessible money.

That’s the gap ourEstate Advance is designed to bridge, giving executors access to up to 50% of the net value of the estate without waiting for assets to be sold.

Who is responsible for dealing with the estate?

Responsibility for dealing with the estate usually falls to the executor named in the will, or an administrator if the person died without one.

Their job is to value the estate, deal with its debts and tax and eventually distribute what’s left to the beneficiaries.

What happens to the estate after someone dies?

Once the executor knows what’s in the estate and what it’s worth, they can deal with any Inheritance Tax and apply for aGrant of Probate, or Letters of Administration if there’s no will.

After that, they can collect or sell the assets, settle the remaining debts and eventually distribute what’s left to the beneficiaries.

How Provira can help

Once you know what’s actually in an estate, the next question is often whether there’s enough accessible money to deal with it. An estate can be worth hundreds of thousands of pounds on paper and still have very little cash available to pay an immediate bill.

If you’re an executor and the estate has plenty of value tied up in property or other assets, ourEstate Advance can give you access to up to 50% of the net value of the estate. There are no monthly repayments, no personal guarantees and no credit checks.

Once probate has been granted, the loan is repaid directly by the estate.

Before you decide anything, we’ll explain how much you may be able to access, what it would cost and how repayment works.

Get in touch with Provira today to find out more.