What does an Executor do?
Of course every estate is different, so each executor will have a different number of jobs to do, but over all they are responsible for the admin side of someone passing away. ‘Responsible’ being the key word here. In simple terms, the executor needs to locate the Will, locate all the assets and liabilities of the estate and secure them. This will involve notifying the deceased’s banks, contacting their utilities to gain balances, secure accounts and stop/continue/amend services required. Then they will apply for Grant of Probate (or Grant of Confirmation in Scotland) and then pay the estate out to bills/liabilities first, and then beneficiaries last. “But what really is Grant of Probate?” I hear you cry, good question!
Grant of Probate is gaining authority to administer someone’s estate. Once the estate details have been researched, then the Executor completes forms (available online) to record the estate specifics and sends these forms to the local Probate Registry (or Sheriffs court in Scotland). The Executor will also need to swear an Executors Oath that the info they have provided is correct. Having a death certificate and Will is sufficient to gather information following someone passing away, but is not sufficient to give someone permission to do the big things – like sell property, access investments etc. So the Probate office will check the details submitted and then the Grant of Probate is the document giving legal permission to the Executor to carry on with the estate.
Waiting for Probate can take some time, so the Executor can busy themselves with filing inheritance tax forms while they’re waiting. Again the forms are available online and can be submitted directly to HMRC. The level of detail needed for these forms can be fairly challenging, and errors can cause delays. For example, gifts given by the deceased over the previous 7 years need to be taken into account as they could still hold an inheritance tax liability. HMRC will then provide details of how much, if any, tax is due and this can be paid from liquid assets where possible if it is due before Probate has been granted.
Once Probate has been granted, the Executor then calls in all the assets – moving funds into their executors account, ready to firstly pay off any liabilities or bills. The Executor holds responsibility for paying these outstanding items, so it’s crucial it’s done first, before paying any funds to beneficiaries. There have been recent cases when things have been missed by Executors, and not come to light until the estate has been wound up. Beneficiaries are not obliged to return their legacies, so the Executors have been left to personally pay the bills they’ve missed. This is why notices are still placed in papers – to help make sure anyone with any financial interest has the chance to come forward if they see someone they are owed by has passed away. Once the bills are paid, then the beneficiaries can be paid – or funds handed to the Trustee’s if a Trust arises. The Executor retains discharge receipts to evidence all of the distribution as everything is completed.
If you are asked to be someone’s Executor as they write their Will, it’s right to feel honoured as it would symbolise the trust they have in you. Likewise when thinking about your Executors trust is a big factor. Also consider their age, ideally they would be younger than you, where they live – although they don’t have to be local to you, as they will need to open an Executors bank account, it is easier if they are a UK resident. There is some general dread around the role of Executor but there is a lot of support available, from free online support sites to professional firms who will literally take everything off your hands. If the Will has been drafted carefully it should include a permission clause to allow Executors to seek professional help at any level and pay any costs from the estate, rather than their own pocket.
Some interesting Facts for Executors;
- Home insurance on a property ceases on the date the policy owner passes away, so if there is a property in the estate, job number 1 for an Executor is to re-arrange home insurance.
- Grant of Probate can be issued in around 3 months, but on average it takes closer to 9 months for beneficiaries to receive their legacies.
- Inheritance tax becomes due at 6 months after death, so it’s important to act swiftly to gain access to the whole estate as soon as possible
We can help you appoint the right Executors in your Will, and help you if you are an Executor for someone else. Remember, advice is free so please get in touch.
Lastly, if you’re wondering about the link with the picture for this topic, the ship in the image is of course Darth Vaders flagship; The Executor – Class Star Dreadnought.