Have you agreed to be an Executor?

It goes without saying that suffering bereavement is emotionally a very difficult time for loved ones.  Unfortunately to compound this difficult period there are usually also lots of things to be organised. From a legal point of view someone will need to have the legal authority to deal with an estate of the deceased. One of the advantages of making a will is that you can choose who has this legal authority. This is usually one or more trusted relatives or friends but can also include a professional advisor. If there is no will then legal rules provide for who has the right to deal with an estate.
A simplified summary of an executor’s role is that they must take custody of and value the assets of the deceased, pay any debts and tax and then distribute the assets under the terms of the will. In reality this role is anything but simple.

If you have been an executor you may already be aware of the challenges-however if you have not yet had to take on the role, the following are pointers you might need to be aware of:

1.       It will be your responsibility to pay any tax (such as Inheritance, Capital Gains and Income) from the assets in the estate. This will need to be declared correctly after thorough enquiries to ensure the accuracy of the information provided to HMRC. An inaccurate return can lead to a penalty fine.

2.       You will need to take steps to pay any debts of the deceased. If you have distributed the estate and a debt later comes to light you could be personally responsible to pay it. There are however simple steps which can to be taken to protect against this risk.

3.       Before payments are made to beneficiaries it is important to ascertain if any of them are bankrupt. If payments are made the executor can be liable to third parties including the trustee in bankruptcy and/or creditors of the bankrupt beneficiary. Again simple steps can be taken to protect against this.

4.       Certain individuals, usually family members and unmarried partners, sometimes have grounds to make a claim against an estate if adequate financial provision is not made for them in the Will. These types of claims must generally be made within a fixed time period. If an executor distributes the estate to the beneficiaries during this time period they could face personal liability to deal with the claim.

5.       Unless you are acting in a professional capacity you cannot charge the estate for your time (although you may be entitled to reasonable out of pocket expenses).

It is worth bearing in mind that just because a person is named as an executor does not mean that they are obliged to act. However, once actions have been taken as an executor it is not usually possible to then decide not to continue. If you are named as an executor in the will of someone who has died recently and you wish to take on the role, a solicitor will be able to guide you through the process and help you avoid the potential pitfalls.
If you wish to discuss your role as an executor or any other matter relating to Wills, Trusts and Probate, please do not hesitate to contact our Private Client specialist Mark Shaw on (01756) 692 866 or email Mark on mark.shaw@awbclaw.co.uk
Mark Shaw
Private Client Solicitor
Tel no: (01756) 692 866