INTRODUCTION
Following the passing away of a close family member or a relative, there is a difficult but necessary legal process to be followed so that any liabilities/responsibilities of the deceased person are handled and so that any remaining assets are distributed.
Everything owned by the deceased at the time of his/her death is called the "estate". By law, any assets belonging to the estate may be distributed only after all dues and liabilities of the deceased, had been settled.
When the deceased had made a valid will, the estate will be dealt with in accordance to the will – subject to the provisions of the law- by a process called "Probate". In the absence of a valid will, the estate will be dealt with in accordance to the relevant law by a process called "Administration". In both cases, a person must be appointed by the Court to manage the procedure. In the first instance, the executor of the will must apply to the Court in order to obtain a Grant of Probate, whereas in the second instance, usually a Cyprus lawyer or an heir applies to the Court in order to obtain the Letters of Administration.
THE PROCESS
The Probate/ Administration procedure is the following:
STEP 1: NECESSARY CERTIFICATES
The heirs or the beneficiaries of the estate should ask for and obtain a Death Certificate and a Certificate listing the legal heirs of the deceased.
STEP 2: THE NOMINATION OF THE ADMINISTRATOR/EXECUTOR
The heirs of the estate should then nominate an Administrator of the estate by signing a Power of Attorney or a declaration accepting the appointment of a person as the Administrator. In the scenario where there is a will, this person will be the executor.
It is paramount that the Administrator obtains some necessary information before applying to the Court such as the full names and addresses of the heirs, as well as any known information regarding the Estate.
STEP 3: APPLYING TO THE COURT
The person nominated as the Administrator/ Executor then applies to the Court for the Grant of Probate or of Letters of Administration whatever the case may be. The application to the Court contains a list of all the heirs and their addresses, a projection regarding the value of the estate, an affidavit by the Administrator/Executor, and a guarantee provided by another person regarding the proper and lawful handling of the Probate/Administration. The documents discussed above, are attached to the application.
The Court, before granting the Grant of Probate or the Letters of the Administration will also ask for a confirmation from the Tax Department. Either the person nominated or the heirs of the estate will have to apply to the Tax Department with the Form (Τ. Φ. 701), in order to obtain the consent of the Tax Department to proceed with the Administration/ Probate.
The Grant of Probate or the Letters of Administration issued by the Court grant the authority to the Executor/ Administrator to act in the place of the deceased person. After obtaining the relevant Court Order the Administrator/ Executor is able to handle the estate of the deceased, acquire any information about the estate, settle any dues and liabilities, and distribute the estate to the heirs or the beneficiaries.
STEP 4: GATHERING UP INFORMATION – DECLARING THE ESTATE
The next step in this process is for the Administrator/ Executor to conduct searches with the Land Registry, Banks, insurance companies, and any other institutions where the deceased had any property or interest.
After the above due diligence, the Administrator/ Executor must open a bank account in the name of the estate of the deceased as any monies of the deceased should be transferred to this account.
Another important obligation of the Administrator/ Executor is the drafting and submission of the inventory of the estate in the Court. The inventory is a list of assets and liabilities of the estate which is submitted to the Court accompanied with an affidavit by the Administrator/ Executor.
STEP 5: CLEARANCE BY THE TAX DEPARTMENT
Once the Administrator is certain regarding the assets and liabilities of the estate, he/she applies to the Tax Department in order to obtain clearance to transfer these assets, as well as a full clearance regarding the deceased person (Form 705). This step might take several months to be completed. As soon as the Tax Department issues clearance, the Executor/Administrator is able to dispose of the property and distribute it to the heirs/ beneficiaries.
STEP 6: DISTRIBUTING THE ESTATE
As previously stated, it is an obligation of the Executor/ Administrator to repay any dues and debts of the estate. This action takes precedence over the distribution of any other asset of the estate. Dues and debts of the estate cannot be inherited by Law. Provided that all debts are settled, then the Executor/Administrator will distribute all remaining assets of the estate among the heirs/ beneficiaries, following each process provided by the appropriate Authority/ institution (e.g. Land Registry, Banks, Insurance Companies etc).
STEP 7: THE FINAL ACCOUNTS
After the distribution of all assets, the Administrator/ Executor prepares and submits to the Court a document known as the "Final Accounts". This document contains all the actions taken by the Administrator/ Executor in regards to the management of the estate, the payment of dues and debts, and the distribution of the assets. The Final Accounts are accompanied by all relevant proof, such as receipts, title deeds, bank transfers, clearance certificates and so on. Additionally, the Final Accounts should be accompanied by a written declaration of all the heirs stating that they have read the final accounts, they agree with its contents, and that they have received their share from the estate.
STEP 8: REVIEW OF THE FINAL ACCOUNTS AND FINALISATION OF THE PROBATE/ADMINISTRATION
The final step of the process is the review of the final accounts by the Registrar of the District Court. If everything was done correctly, the Registrar will issue a note stating that the Executor/ Administrator is relieved of his/her duties and that the Probate/Administration has been finalized.
It is important to note that the above-described process is in a nutshell and there might be additional steps to be taken depending on the case. Moreover, the Court may ask for additional documentation and even the submission of intermediate accounts where necessary.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
