Executers

For the deceased’s assets to be distributed amongst the beneficiaries, the personal representatives (a generic term for both executors and administrators) are required when there is no will in place, or when there is a will but there is no executor able or willing to act.

 

Executors

An executor is a person appointed to administer the deceased’s estate according to the will and any relevant provisions set out by the law. It is recommended that a solicitor and not a family member is appointed to avoid potential future arguments.

 

Renunciation of an executor

Although you may invite someone as an executor, they cannot be forced to accept. If you have refused to act as an executor you must ensure not to intermeddle (such as notifying the bank of the deceased’s death, settling the deceased’s debts etc). If you ‘intermeddle’, you will lose your right to renounce and consequently, you will have to act as executor. To renounce executorship, you must inform Probate Registry in writing. If you have been appointed as an executor and a trustee, renouncing your executorship will not affect your status as a trustee.

 

Grant of representation

To commence the process of handling the deceased’s estate and transferring assets to the beneficiaries, the executor(s) will need to apply for a grant of representation at the appropriate court. They can instruct a solicitor or probate practitioner to help with this. Along with your completed forms, you will also need to send any other relevant documentation such as any will, death certificate and HMRC Inheritance Tax forms. If all has been executed correctly, the grant is then prepared and sealed by the court. The majority of probate matters are dealt with in the Family Division of the High Court provided that the will is not contested. In many cases, it may be more appropriate to use a local Registry, but this is not a requirement. If the probate matter is contentious the Chancery Division of the High Court will instead settle the matter. The County Court will instead deal with the application if the deceased’s estate is less than £350,000.

 

Types of Grants:

There are 3 types of common grants the personal representative(s) can apply for:

• Grant of probate
  • This is where the deceased has left a valid will which appoints executors willing to act
• Grant of letters of administration with will annexed
  • This is most appropriate when the deceased has left a valid will, but there are no executors able/willing to apply for a grant of probate, or the estate is partially intestate.
• Grant of letters of administration
  • The deceased has not left a valid will. The order of entitlement to grant is set out by statute for grants of letters of administration.

 

Administrative Powers of Personal Representatives

Personal representatives have a statutory duty to carry out various powers. These powers include but are not limited to the powers listed below.

 

Power to Sell, Mortgage or Lease

This power may be executed to pay various administrative expenses such as tax, funeral costs and debts.

 

Power to Accept Receipt’s for a Minor’s Property

As a minor is unable to receive a valid receipt for monies or assets transferred to them, personal representatives can appoint a trustee for the minor if they have a vested interest. The simplest way to deal with any uncertainty is for the testator to include an express clause within the will explaining what process they would like to be carried out.

 

Power to Maintain a Minor

Section 31 of the Trustees Act 1925 (which also applies to personal representatives) states that income for the maintenance or educational benefit of a minor can be provided before the minor turns 18 years old if the property or gifts are held on behalf of the minor allows for interim income.

 

Power to Advance Capital

Section 32 of the Trustees Act 1925 allows trustees to advance capital to a beneficiary (whether a minor or not) who has vested or contingent interest in the capital at their discretion. The tester may vary the terms of the statute in the will as they choose.

 

Power to Insure

Personal representatives can insure any trust property against risks to the full value of the property.

 

Power to Delegate (‘Pass Off’)

Personal representatives can pass off particular functions to agents on agreed terms (if they are not already set out in the will).

 

Power to Indemnify for Expenses

Personal representatives can reimburse themselves for any incurred expenses.

 

Exercise of Personal Representatives Powers

Where there is more than one personal representative, the power is held equally between them.

 

Collecting and Realising Assets

The personal representatives should prioritise maintaining sufficient funds to pay off any of the loans they have taken out to cover the inheritance tax liability.

 

Sales of Assets

In deciding to sell assets, the will should be referred to for guidance, and the personal representatives should consider the beneficiaries wishes, e.g., any property specifically gifted in the will should not be sold unless all other assets have been exhausted.

  

Administration of Estate

After payment of any outstanding debts, funeral expenses and all tax, the personable representatives are then able to distribute the remaining assets left as gifts to the beneficiaries in the will. Any costs relating to the transfers must be incurred by the beneficiary unless the will has any express provision which states otherwise.

 

Receipts

Personal representatives should obtain a receipt from beneficiaries to evidence that they have satisfied their obligations to them.

 

Distribution of the Residue Estate

Once all debts and legacies have been paid, the personal representatives must then determine the residue which needs to be distributed following consideration of the tax implications, reasonable funeral expenses, and any professional or legal costs. As the personal representatives are acting in a professional capacity, they may also consider their remuneration for the duties they have carried out.

 

How we can help

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