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Guide For Executors

Responsibilities in dealing with an estate.

Guide for executors

Introduction

Being appointed as an executor is an important role, with a great deal of work and responsibility. Very few people get a chance to practice this.

This brief guide is designed to help you to deal with the many different tasks of an executor. We have, over the years, helped hundreds of executors to fill in the forms and close estates of every size and complexity. We always recommend that legal advice be sought from a specialist probate solicitor.

Your duties as an executor

Your duties as an executor are essentially to collect and protect the assets of the deceased and pay off any debts of the estate. This includes dealing with Her Majesty’s Revenue and Customs (HMRC) for Inheritance Tax and distributing the remaining assets, according to the will, to the appropriate beneficiaries. This sounds easy, but will take longer than might be thought! Most estates can be closed in about six months, however a year is not unusual.

If there is a will, you will be the personal representative. If not, then you will be the administrator (special rules apply in such cases, known as the rules of intestacy).

It is possible and often wise to seek assistance from a solicitor or probate specialist. An executor can also pass the whole of their responsibility to a law firm. To help reduce costs it is possible to appoint a solicitor, but then do much of the leg work yourself. At the very least, an executor will end up signing a lot of forms and letters.

Note that an executor can claim reasonable expenses from the estate for the work involved in administration.

Stages in dealing with an estate

When the death is registered, be sure to obtain several copies of the death certificate.

DOCUMENT

Locate all documents. Check to make sure that the copy of the will is the most up-to-date. Make sure that you are aware of any gifts the deceased gave in the last seven years, as these could be potentially exempt transfers (PETs) and special rules and allowances apply. Some items may need valuing up to six years after they were given away.

ADVISE

Advise all banks, building societies, stockbrokers, accountants, and insurance companies, of the death, providing them with a certified copy of the death certificate. Ask for statements of account, as of the date of death. There may be insurance against the tax liability and/or to pay for the funeral.

ADVICE

Visit the HMRC website. There is a great deal of useful advice on the site about filling in the relevant forms required, many of which can be downloaded.

PREPARE

A list of all the assets and values. This list will include the home and other property, stocks and shares, bank & building society accounts, motor car and household contents. You will need the help of a specialist probate valuer to make an independent inventory of the personal property (chattels) and a chartered surveyor to value the house/real estate/property. An independent valuation is always recommended, as HMRC can see that you have done your best to get the right figures for the Inheritance Tax Assessment (IHTA).

COMPLETE

The tax return IHT 400. This will tell you whether there is any tax to pay and also how much this will be. There are allowances, which change over time. Currently (as of January 2010) the first £310,000 is free of duty. Thereafter, duty is 40%.

SETTLE

Then comes the task of paying the tax, if any is due. This has to be done before any of the assets can be distributed to beneficiaries. The personal representative or administrator is personally liable for the tax but is indemnified by the estate. So in theory you will not end up paying it out of your pocket. HMRC usually understands if small items are distributed after a valuation has been taken and before Grant of Representation (probate) is made.

PROBATE

Finally Grant of Representation (probate) or Administration is made. You can then distribute to the beneficiaries all of the assets of the deceased and close the estate. This will often mean selling the property and any contents not wanted by the beneficiaries and on occasion employing a house clearer. A good local auctioneer will be able to arrange this and recommend a reliable and honest agent for you.


Our Valuers are regulated by the Royal Institution of Chartered Surveyors (RICS) and follow their ‘Red Book’ guidance on valuation practice.