How to be an executor

Paul Lewis / 17 February 2020

Being the executor of a will can be a complex task for those carrying it out, says Paul Lewis.



Every will contains the names of the people responsible for implementing the wishes of the deceased person. They are called executors. There can be up to four and often they are beneficiaries of the will. Being an executor is mainly an administrative task but it does come with legal obligations. If you make  a mistake with inheritance tax, miss debts or pay beneficiaries the wrong amounts, you may be personally liable for the sums involved. Only do it yourself if you are confident with numbers and like writing letters!

A lawyer will do the work for you but will usually charge a percentage of the value of the estate. You may prefer that option if you are not confident about doing it yourself. Or a cheaper compromise is to take on the task yourself but to ask a lawyer for advice on any knotty problems that crop up.

As soon as the person has died, report the death at the local Register Office. You will get a death certificate and can ask for extra certified copies – you may need several as some finance firms will insist on seeing one before dealing with you. Use the official gov.uk service ‘Tell Us Once’ to inform central and local government departments responsible for things such as benefits, state pension, council tax and disabled badges.

Find the will, which is normally kept by the solicitor who drew it up. If a lawyer or bank is named as an executor, they will usually take over the job and charge that percentage fee. Otherwise the named executors should decide how to divide the tasks. If you come across legal points you are not sure about, then pay a solicitor a fee for their advice. As a non-professional executor you cannot be paid for your work but you can reimburse yourself for any necessary expenses from the estate.

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Assets and debts

Collect details of all the assets owned and debts due. Find the paperwork and get final statements for:

• bank accounts

• savings

• investments

• insurance

• finance deals

• mortgages

• equity release

• pensions being paid out now or others the deceased was paying into.

Contact all the firms to tell them that the person has died. Some will need a certified death certificate, others will accept a photocopy. You must also find details of any property owned and get it valued. Get jewellery or other valuables worth more than £500 professionally valued too.

Some property such as a home or money in a bank account may be jointly owned with a spouse or partner. If it is then ownership normally transfers automatically to the joint owner. But half its value will form part of the estate. Pension funds and life insurance will not normally form part of the estate for tax purposes but that depends on the details when they were set up; you must check with the firms involved.

Tax

Once the financial details of assets and liabilities are assembled and totalled you should report the estate’s value to HMRC. If the estate is left to a spouse or civil partner, then no inheritance tax is due. Otherwise tax may be due if the estate is more than £325,000 – or up

to £475,000 if the family home is passing to  a descendant. If the person who died was a widow or widower, then you can usually double those amounts as they can leave twice as much if they inherited in full from their late spouse.

Even if no tax is due, you may have to fill in an HMRC form. Inheritance tax must be paid within six months of the death. You should be able to use cash in savings accounts, but if you need more you will have to borrow from the bank. Tax due on a dwelling can be spread over ten years, but you will pay interest on the tax due.

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Probate

If there is property or investments owned by the deceased, or large amounts of savings, then you need to obtain what is called probate from the local Probate Registry before they can be released. There is normally a fee of £215. Nowadays probate can take several months to come through. If the estate is small and consists of cash or jointly owned property, there may be no need to get probate. Firms have their own limits but some will release assets without it. If there is no will, then a spouse or civil partner or a child of the deceased can apply to be the administrator of the estate.

Once you have probate – or if you do not need it – apply for the assets to be released. Ask your bank if you can open an executor’s account for them to be paid into. Pay the funeral bill first, then other legally binding debts. You can place a Deceased Estates Notice in the London Gazette asking creditors to come forward. If they do not, they have no claim on the estate. If there is no money in the estate after the funeral, any debts should be written off. Relatives do not have to pay them. If there is a balance left, then it is distributed in accordance with the will or the rules of intestacy if there is no will. You should keep all executor records for 20 years.

This article is based on the law and rules in England. The situation is similar in the rest of the UK, however details and terminology – especially in Scotland – may differ.

Further information: Call the HMRC inheritance tax and probate helpline: 0300 123 1072. Online, at gov.uk search ‘probate’ or ‘inheritance tax’ or ‘valuing an estate’. Search ‘probate’ at citizensadvice.org.uk




The opinions expressed are those of the author and are not held by Saga unless specifically stated.

The material is for general information only and does not constitute investment, tax, legal, medical or other form of advice. You should not rely on this information to make (or refrain from making) any decisions. Always obtain independent, professional advice for your own particular situation.