What is an Executor?
An Executor is the person or people who are identified in the Will of a deceased person as someone they trusted to sort out their estate on their death.
Being an Executor is therefore a role of considerable trust and responsibility.
Of course, not everybody dies with a valid Will in place. Where someone dies with no Will they are said to have died intestate. In that case, as there’s no Executor appointed, the person or people who sort the estate out are known as Administrators. They are identified by law, according to a strict hierarchy within the family. They are usually the surviving spouse or civil partner, but if there was none, then the children are appointed.
Executors and administrators are known more easily as personal representatives – or PRs.
It’s important to stress that a personal representative is a legal appointment and they are legally responsible for dealing with the deceased’s assets, property and debts. The role can be complex and carries a lot of responsibility. They need to deal with legal, tax and financial issues to sort the estate out. Personal Representatives can also be held accountable for any mistakes they make.
If you feel that you do not wish to continue with your responsibilities on your own it is important that you contact us as soon as possible. Phoenix Wills & Probate can work alongside you and take responsibility for administering the estate of your loved one.
Duties of Personal Representatives can include…
Safeguarding the assets of the estate
- One way to think about this is that Personal Representatives (PRs) have to safeguard the assets of the estate, so that beneficiaries receive their full inheritance.
- It might not be obvious, but for example, you might need to change the locks on an empty house, or ensure that utilities are switched off to avoid fire, or flood damage due to leaky pipes.
- You might need to ensure that valuables are stored safely, so that if an empty house were burgled, the assets inside are not stolen.
- House insurance ends when the policy holder dies. You may need to re-insure the house.
Assessing the estate
- You will need to identify all assets owned by the deceased. You would also have to find out about their debts and find out what their values were at the time of death.
- Once this information has been found you are then responsible for identifying whether there are any inheritance tax, capital gains or income tax liabilities, and paying those taxes at some point.
- You will need to work closely with HMRC to declare all assets and liabilities and complete the relevant IHT205 or IHT400 form.
- Once inheritance tax has been paid you need to obtain the grant of probate (for executors) or letters of administration (where someone died without a valid Will). This is a vital document as it gives you legal permission to act on the assets originally owned by the deceased.
- The PR then needs to recover all assets, pay debts, sell any property in the estate and complete accounts for the estate.
- Once all debts and expenses have been paid off the PR can finally distribute the estate to the beneficiaries (if there was a Will, to those named in the Will) or if there was no Will, according to the laws of intestacy.
What are the risks of acting personally?
Think about it, a personal representative is ultimately responsible for the transfer of assets of the deceased to the people the deceased identified in the Will, or through intestacy. So, beneficiaries can sometime receive less if a personal representative makes a mistake. The risks therefore are:
- A failure to pay the right amount of tax or to pay all the debts on the estate.
- Failure to identify all those who might have a claim on the estate (someone not known who the deceased owed money to, or a long-lost relative of the deceased).
- Distributing the estate to someone incorrectly, so another beneficiary misses out.
For free initial no-obligation advice and guidance please contact Phoenix Wills & Probate: