Executors

Choosing, and being chosen

The executor carries out the terms of the will - but must do so in a manner that achieves the maximum benefit for the estate. Executors have responsibilities toward the beneficiaries as well as to the testator.

The executor can be, and usually is, a beneficiary of the will - a spouse, civil partner, other relative (son, daughter, nephew, niece, etc) or friend. Executor must be at least 18 years old. Children can be named as executors but they can not serve until they reach 18.

A solicitor, bank or other professional can act as executor, but they charge a fee - and it can be stiff. In many instances, the fee is worth it: experienced solicitors and other professionals can get the work done quickly and accurately and legally. They are also not emotionally involved and hence avoid squabbles that can occur between executors who don't get along with one another.

Testators are under no obligation to appoint executors, and many people make perfectly valid wills without naming any executors.

Typically, two executors are named in wills - either to help each other, or to increase the chances of having at least one executor should the other decline - due to illness or any other number of reasons - or die. If a will lists more than four executors, probate will be granted only to the four heading the list.

Being named as an executor in a will does not oblige the person to accept the role. Someone can even agree in advance to be an executor and then decline when the testator dies.

There are good reasons to refuse to act as an executor: it takes a lot of time and effort sorting out personal possessions, bank accounts, debts and the like. Executors also run financial and legal risks.

For the testator, the burden is to select an executor who will actually keep his word about accepting the role, and also be up to the job, which can be a grind intellectually and emotionally, when the time comes.

WWP Tip Testators should consider including clauses in the will for the executors' benefit; for example, offering to pay for solicitor fees out of the estate. Non-professional executors can not charge for their time, but testators generally provide for them in the will, awarding them a cash amount, a case of whiskey or other gift or compensation.

Looking ahead

If you are healthy, wealthy, wise and between, say 35 and 40 years old when you make your will, and you choose your executors from among your friends, they are likely to be roughly the same age as you. Statistically, all of you are likely to live for several more decades, but cancer and car accidents are no respecters of statistics. If you do not revise your will periodically, you may have a valid will and no executors. Or your executors, no longer young and hale and hearty, may not be up to the task physically or emotionally. This problem is especially acute for people who make their wills when they are in their 50s and 60s and select friends as executors.

No but thanks for thinking of me

A named executor can refuse to accept the position, and the renunciation should be in writing. And the sooner the better: if you are named as an executor in an estate in which assets have started to be distributed, it might be difficult if not impossible to renounce. It will certainly be costly. To be on the safe side, renounce before what solicitors call "intermeddling" has begun.

It is far better for an executor to renounce while the testator is still alive, thereby giving the testator an opportunity to choose a new executor. If an executor renounces after the testator has died, the named alternate becomes an executor - but this person may also renounce, or may no longer be alive.

"Power reserved"

A half-way house between accepting and rejecting an executorship is to remain an executor but with "power reserved." The other executor(s) administers the estate and keeps you informed, although your role now is passive, not active.

Executor Remuneration

Professional executors are paid for their labours, lay executors (friends, relatives, neighbours) are not. Lay executors can be reimbursed for expenses; otherwise, it is a labour of love. Testators can, however, specify in the will that the executors should be paid and indicate the amount.

If...

If you do not appoint an executor...

If you do not make a will (die intestate)...

Someone will have to carry out the terms of your will, and that person will be a court-appointed administrator. An administrator will also have to be appointed if you die intestate.

Executors and administrators are similar but not identical, and the differences are important.

An executor assumes authority, and can begin work, from the moment of death - organising the funeral, for example, and protecting the testator's assets.

The administrator can not begin administering the estate until he or she is appointed, and that takes time - during which family disputes can occur, and possessions disappear.

Executors are selected by the testator, whereas administrators are appointed by the probate service.

Professional Executors - Yes, No, Something in between

Testators can appoint a solicitor, bank or other professional as the executor. These professionals charge a fee for this service - usually a flat fee or a percentage of the estate - or both.

The size of the estate is not necessarily linked to the amount of work an executor is likely to face. A millionaire with relatively simple and straightforward financial affairs who leaves everything to his or her only child, for example, may have an estate that is easy to wind up. A percentage arrangement can mean that the executor enjoys a nice pay day for relatively little work. A bank charging four or five per cent on a million-pound estate can earn £4,000 or £5,000 simply for writing a few letters.

Hiring a professional need not be an either-or yes-no choice.

A friend or relative - that is, a non-professional executor - can deal with the initial or easy parts of probate and hire a solicitor, accountant or other professional as and when needed to sort out a specific aspect of the estate. The solicitor's fee for a specific task should be considerably less than their fee if they were to oversee the entire process.

Making life easier for executors

Executors will incur at least some expenses - travel, postage and the like. The estate will reimburse them.

The estate can also pay for the executor to consult a solicitor. Executors can be held responsible for the actions of others, including unscrupulous behaviour by a co-executor.

The executors' bible is Probate Office form PA2 - a mercifully short (seven pages) and clearly written brochure outlining the main executor responsibilities. Print versions are available from probate offices, and it can be read on, and downloaded from, the internet.

PA2's title is: How to obtain probate - A guide for people acting without a solicitor. It is one of 14 forms and leaflets published by the Probate Office, all of which are listed in PA2 as well as a few Revenue and Customs brochures regarding inheritance tax. Forms from both organisations are listed here.

On the other hand

Large estates - and estates with large debts - may require a professional executor.

Only a decade or so ago, most ordinary people had small or modest estates - some cash in the bank, some stocks and shares, a few pieces of jewellery. Such estates were, and still are, relatively easy to administer.

Nowadays, our much richer society has yielded more complicated estates, with many people

• owning second-homes or buy-to-let properties
• owning a business
• in debt (credit cards, bank loans, overdrafts, and the like)
• owning a property or other assets in a foreign country
• having family members or beneficiaries living abroad
• possessing estates valued above the inheritance tax threshold

Does a property have to be sold to pay the IHT tax? Are there children under 18 for whom trusts will have to be organised? Matters such as these may require a professional executor either to handle the entire estate, or - the cheaper option - to consult on specific points or questions.

I am an executor - now what?

Some issues may need to be dealt with immediately: Is the cat being fed and looked after? Is the house, with its furnishings and possessions, secure? The executor may also have to organise the funeral.

The major task is to distribute the assets of the deceased, and the executor obtains the right to represent the deceased - in effect, to obtain the assets - by applying for a Grant of Representation. This is done through probate.

To obtain the Grant, you apply to the probate office by submitting an application (PA1) with relevant documents - the will, death certificate and other documents, including notes left with the will, possibly also a Lasting Power of Attorney. Form PA1 is downloadable on the internet.

Probate may involve a personal interview and the swearing of an oath.

What if an executor lives far from the probate office or needs more time?

Probate allows for certain delays and other ifs and buts. The PA2 brochure provides a good overview of routine and not-so-routine procedures. PA2 also gives some practical tips. For example, if the will can not be located in the testator's home, other likely hiding places are solicitors, banks and the Principal Probate Registry in London.

Executor responsibilities

The executor's responsibilities include some or all of the following:

• find the will
• arrange care for pets
• organise the funeral
• deal with a co-executor
• apply for probate
• determine the value of the estate and distribute the assets
• protect a property
• trace beneficiaries
• deal with banks, solicitors, trustees, utilities and so forth

Executor v Executor - "Double Probate"

Executors can disagree on the timing to prove a will. Such situations are legally and financially complicated. If the reluctant executor wants to wait a while and become executor later, HM Revenue and Customs can make a grant of double probate.