What is an executor?
An executor is named in a person’s will and is responsible for carrying out the terms in the will and overseeing the settling of the deceased’s estate. If you have agreed to act as an executor, it is important to understand the strict legal rules to be followed otherwise there could be significant consequences. The executor can be held financially and civilly liable for anything done that is not in the best interests of the beneficiaries.
The role of an executor carries a great deal of responsibility and, depending on the complexity of the estate, it may involve a great deal of time. It should never be taken on without fully understanding the responsibilities that go with the role.
Up to four executors can be appointed so the workload is shared, but all decisions must be made jointly. This is also a good idea in case one of them are unwilling or unable to carry out the role when they are required to.
What are an executor’s main responsibilities?
- Obtain the most up-to-date version of the will. To be able to do this, a death certificate and proof of identity are required.
- Provide copies of the will for each executor and beneficiary.
- Financial institutions such as banks and building societies will need an original death certificate. Direct debits need to be cancelled and account balances and investment values on the date of the death will be required.
- Payment of any salary, pensions and state benefits to the person who has died need to be stopped. Issuers of their credit cards, passport, driver’s licence and TV licence need to be informed of the death and their instructions acted on.
- Go through paperwork, bills or statements such as energy suppliers or the local council and check for any debts or overpayments. If it is possible that there might be more debts than assets, the estate could be insolvent. Before you go any further professional help should be sought.
- Contact the deceased person’s tax office to find out whether any tax is owed.
- If the person who has died left instructions for their funeral, it’s the executors responsibility to ensure they’re followed, and arrangements made.
- Apply for probate after the value of the estate is estimated and work out if there’s Inheritance Tax to pay. (If there is no property and the estate is estimated at low amount probate will possibly not be needed.
- Before paying out to beneficiaries it is worth putting a ‘statutory notice for creditors’ in the media, allowing two months for any claims to be made. If you don’t, any executors are personally responsible for any claims that arise after monies are distributed. If the notice is placed, any future claims against the estate are made against the beneficiaries.
- Before the estate is distributed any outstanding tax, debts or bills need to be paid. Some banks offer an executor’s account into which you can transfer any money paid to the estate. This stops estate money from getting confused with your personal finances. Accounting for and maintaining any assets that are part of the deceased’s estate is the responsibility of the executors until it’s time to distribute them.