If someone asks you to be an executor of their estate after their death, you may feel honoured. However many people are completely unaware of the considerable responsibilities that accompany such a role. Administering an estate can be time-consuming and demanding.
Executors are legally bound to carry out their duties properly. They can be personally liable for any mistakes or incorrect distributions. This liability can be personal and is not always limited to the assets of the estate.
Whilst a professional executor, such as a Solicitor or Accountant, may be paid for their time, other executors are not usually entitled to payment, although they can be reimbursed for reasonable expenses.
If you are appointed as an executor under a Will, you do not have to take up the post if you decide you do not wish to act in this capacity. However you will need to state at the outset that you do not wish to do so and not begin to help with the administration of the estate, as you will then be expected to continue.
The main duty of the executors is to administer the estate in accordance with the law and to ensure that the wishes of the person who died have been carried out as set out in the will.
If there is no will, the estate is administered by the people who are entitled to inherit the estate, according to intestacy rules. They are referred to as administrators, rather than as executors but their role and responsibilities are similar.
Executors may need to deal with registering a death; organising the funeral; locating, securing, insuring and valuing assets of the estate; ascertaining liabilities; collating information and submitting accounts to HMRC and/or the Probate Registry (if a Grant of Probate is necessary); calling in the assets of the estate; selling property; settling liabilities; accounting for inheritance tax, income tax and capital gains tax; the preparation of estate accounts, and finally, distributing the estate to the beneficiaries named in the will.
Disputes over estates are on the increase and there have been a number of cases in recent years where executors have personally faced legal and financial claims from beneficiaries and HMRC. In the event of such a situation, if you have a solicitor handling the estate administration for you, this can help protect your position. If you decide to handle the estate administration yourself, you may wish to take out executor's insurance.
It might be an honour, but it’s certainly not a role to be taken lightly!
If you need advice on how to carry out your duties as an executor, contact Emma Harrison on 01827 317081 or firstname.lastname@example.org.