What to do when a client passes away

Client passes away suddenly - nextsteps

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Hi All

A client has very suddenly passed away. He is the sole shareholder and director of a limited company. We represent both the client and his company. I am not too sure what the next steps should be on my behalf or what practical assistance I can provide to his wife who is trying to sort everything out. 

Everything is up to date with company compliance wise so there is nothing urgent that requires attention. Do I simply wait for the executors of his estate to make contact? Will a self assessment tax return be required for 2016/17? I assume yes, but the executors will need to appoint me for this.

Is the original engagement letter with the company still valid?

Any advice would be appreciated. 

Replies (8)

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Stepurhan
By stepurhan
27th Apr 2017 16:31

A return will be required up to date of death, whichever tax year that is in.

You will lose authorisation for the individual as soon as HMRC are made aware they have died. The same should not be true of the company, though technically you are no longer instructed to act.

A new director will be needed for the company. I am assuming that, until the estate has passed, the executors (as temporary shareholders) can appoint someone. Not had experience of that so a call to Companies House is probably in order to confirm.

You will need to be reappointed by the executors (they can also grant you a new authorisation for the individuals tax affairs). New engagement letters are advisable.

Thanks (1)
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By CJaneH
27th Apr 2017 16:35

I have not ben in position of acting for company director dying 'in harness'.

Death cancels your status as agent to the deceased. Be pro-active in contacting solicitor as you are in better position to prepare & submit 2016-17 tax return.

Solicitor should require your assistance in collating details to value estate for probate.

As company has not died I would assume you are still engaged by the company and its agent until shares transferred and new director appointed. Though I am sure some other reader can give more detail.

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Replying to CJaneH:
By johngroganjga
27th Apr 2017 16:39

The OP will continue to be engaged by the company even after shares have been transferred and a new director appointed, unless and until the new director terminates the engagement.

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Replying to johngroganjga:
Stepurhan
By stepurhan
27th Apr 2017 17:02

johngroganjga wrote:

The OP will continue to be engaged by the company even after shares have been transferred and a new director appointed, unless and until the new director terminates the engagement.


The old separate legal entity position of course.

If the deceased ran most things through the company, that should hopefully make things a bit easier. Since this has just occurred to me, have you any ideas what the normal practice on bank mandates is in these circumstances?

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Replying to stepurhan:
By johngroganjga
27th Apr 2017 17:33

Not had any direct experience, but common sense says that the new board will have to be appointed and then nominate signatories in the bank's prescribed form.

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Replying to johngroganjga:
RLI
By lionofludesch
27th Apr 2017 18:46

It's a long time since I dealt with one of these but I believe that any company cheques signed by the deceased (before his demise obviously) will be honoured and all standing orders and direct debits will remain valid.

My advice would be to wait a respectful time and then offer your services to the executors/widow/whoever your contact might be.

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By SteveRA
27th Apr 2017 19:19

If you are in touch with the widow, I would suggest to her that she tries the 'Tell us Once' service on Gov.UK. my clients have used these twice in the last few months and it reduces the need for lots of letters to different government departments.

Find it using Google. HMRC will then be informed of the death and will issue a paper tax return for outstanding year(s) including one to the date of death. They also send a form for reappointing an agent.

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Replying to SteveRA:
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By Dib
28th Apr 2017 13:24

Might I just add a note of caution to this? I am aware of a case where someone used the "Tell us Once" service and HMRC then refused to accept a tax return signed by a different execotor as it 'nominated' the person who had notified using the service as the main executor.

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