Glossary of Terms
Absolute interest - An interest that the beneficiary is completely entitled to immediately, without any restrictions.
Abatement - A reduction of the amount of legacies or debts or claims where an estate is insufficient to pay all in full. This is normally made pro rata
Accumulation - The retaining and re-investment of interest.
Acquisition / probate value - The value at which either the personal representatives or the beneficiary acquires the assets.
Adeem / ademption - Either the complete or partial extinction of a specific bequest as a result of the deceased having gifted, sold or otherwise disposed of it during his lifetime, other than by revocation.
Administration period - The period between the date of death and the date of the close of administration.
Administrator - The legal representatives of a deceased person who has died without a will. They are usually the closest relatives of the deceased.
Advancement, power of - The power given to pay capital monies held in trust to or for the benefit of a beneficiary of the trust.
Affidavit / oath - Written statement by a person called 'the Deponent', who signs it and swears or affirms to the truth of its contents.
Agreed value - The probate value as formally agreed by the Capital Taxes Office where inheritance tax is payable.
Appointment, power of - A power given by will or deed to appoint a person or class of persons to inherit an interest.
Apportionment -The division of income in proportionate shares between certain beneficiaries, calculated on a daily basis.
Appropriation - The transfer of an asset, instead of its sale proceeds, on account of a legacy or share of residue.
Attorney - A person appointed by another to act in his place.
Bequest - A gift of chattels / assets in the will.
Call - Demand upon the holder of partially paid shares to pay the balance.
Capital Taxes Office - The division of the Inland Revenue which deals with all aspects of inheritance tax, capital transfer tax and estate duty.
Chose in action - Right of action to recover a sum due, or an entitlement to an interest in an estate.
Chain of representation - The legal system by which the executor of a sole or last surviving executor becomes the executor of that testator.
Clearance certificate / certificate of discharge - A certificate issued by the Capital Taxes Office releasing a person liable to inheritance tax from paying further inheritance tax.
Estate - All the assets and liabilities of a deceased person – such as property, shares, cash, savings and investments as well as outstanding debts.
Estate accounts - Accounts recording the financial transactions during the administration period.
Estate in fee simple - An absolute freehold interest.
Excepted estate - An estate where no Inland Revenue account is necessary if certain criteria are fulfilled.
Executor - A person appointed by a will or codicil to wind up the estate.
Exit charge - A charge to inheritance tax which arises on distributions made out of a discretionary trust.
Gift - A gratuitous transfer of money or assets.
Grant of representation - This is obtained from the Probate Registry following a death. The Grant will be made to the executors where there is a will and to the closest relatives where there is no will. This document is called a Grant of Probate where there is a will and a Grant of Letters of Administration where there is no will. A deceased person's estate can be dealt with once the Grant of Representation has been obtained.
IHT - Inheritance tax
Instrument of variation - A document whereby the will or intestacy provisions of a deceased person can be varied.
Intestacy - The situation where a person dies without making a will fully disposing of all his assets. The administration of ‘intestate’ estate is governed by the Administration of Estates Act 1925.
Legacy / bequest / devise - A gift of chattels / assets by will.
Legal estate - The estate capable of being transferred or conveyed at common law.
Letters of administration - This is obtained from the Probate Registry following a death. The Grant will be made to the executors where there is a will and to the closest relatives where there is no will. This document is called a Grant of Letters of Administration where there is no will.
Nil rate band - The amount of the value of assets which a deceased person can leave to friends or family without having to pay any Inheritance Tax.
Personal chattels - Essentially personal effects. Does not include any chattels used at death for business purposes and any money or securities for money.
Personal representative - An executor or administrator.
Power of attorney - Formal deed by which one person appoints another to act on his behalf or represent him.
Power reserved - The power reserved by a named executor who declines to act as such to do so at a later date.
Probate - This is obtained from the Probate Registry following a death. The Grant will be made to the executors where there is a will (Grant of Probate) and to the closest relatives where there is no will.
Renouncing probate - The act whereby a named executor signs a legal document which cancels his/her appointment from the start.
Residuary beneficiary - The person entitled to the whole of the deceased's estate after the payment of all debts, funeral and testamentary expenses and legacies.
Residuary estate / residue - What remains of the estate after payment of all debts, legacies and all taxes and expenses.
Specific legacy - A particular part of a deceased's estate.
Testate - Dying leaving a will.
Testator - Deceased who left a will.
Trustee - Person who is holding assets on trust.
Vested interest - Right to immediate or future entitlement.Absolute interest - An interest that the beneficiary is completely entitled to immediately, without any restrictions.