What is an executor of a Will?
An executor of a Will is the person nominated to take care of a deceased person's estate after they pass away.
Being an executor of a Will can feel overwhelming for some people, but it doesn’t need to be.
Your main role as executor is to represent the person who has passed away and wrap up all of their personal, financial and legal affairs. Ideally, this person will have explained how they’d like you to carry out your duties in their Will.
Most importantly, remember that there is no reason to stress about your new responsibilities. You can always access the guidance you need.
If you need advice on administering a Will, our expert Wills and Estates lawyers can guide you through the process and ensure you make informed decisions.
What are your responsibilities?
Generally, your role is pretty straightforward. Being appointed as an executor can even be seen as quite an honour. However, in some cases, like when a person hasn't done a great job of their estate planning or neglected it entirely, estate administration can be a difficult, time-consuming and emotional process. Without the right support, that is. Plus, an executor can even be held liable for making certain mistakes when administering a Will.
So, before you jump into the nitty gritty aspects of estate administration, take your time to grieve and plan a meaningful funeral with friends and family.
Once you've finalised a memorable send-off, an experienced lawyer can help clarify the legal and financial responsibilities of being an executor. They can also help protect you from potential lawsuits.
Here is a list of the 6 main responsibilities you now have as an executor of a Will:
- apply for probate
- preserve the assets
- gather the estate assets and pay liabilities
- defend the estate during any legal proceedings
- manage the deceased person's tax affairs
- distribute the assets.
1. Apply for probate
Before you can officially act as executor of a Will you first need to apply for a 'Grant of Probate' from the court.
Simply put, probate ensures the Will is valid and that you have the court's permission to carry out your responsibilities as an executor.
If you are in NSW or VIC you can apply for probate online and we will manage the entire application process for you:
2. Preserve the assets of the estate
You now need to properly preserve and maintain the assets you found until you can distribute them.
This means that you have to:
- Secure and insure any real estate or other property that belongs to the deceased person. You need to do this until the property is sold or ready for you to distribute.
- Make sure that any cash remaining in the deceased person's bank accounts is accruing interest.
We recommend you make this task a big priority. You want to do everything you can to prevent a personal claim bring made against you for making a mistake.
Our Wills and Estates experts are available to help you get this process started right away.
3. Gather the estate assets and pay liabilities
Correctly distributing the assets of the deceased person is probably your main responsibility. But, to do this properly (and legally), you first need to locate the assets.
Locating assets involves tracking down quite a few important documents. Some of the documents you might need include:
- recent bank and credit card statements from the last two years
- building society account statements
- certificates of title for any real estate holdings
- latest rates notices for any properties
- mortgage documents
- share and debenture investment certificates
- life and other insurance policy documents
- private insurance certificates (this may help pay for funeral expenses)
- unpaid debt notices
- registration papers and insurance documents for any owned or leased vehicles
- funeral account details
- any other documents you can find that specifically relate to the deceased person's affairs.
4. Defend the estate during any legal proceedings
If someone decides they want to try and contest or hold up the Will in court, you have to step in and defend the estate. Your official title here is, 'legal personal representative'.
While Will disputes heading to court is unlikely, they have been increasing in recent years. So, it's important to be prepared.
To help prepare you, there are two main types of legal attacks you may have to face:
- Family provision applications
More commonly known as 'contesting a Will', this attack is when a beneficiary of the Will wants an extra share of the estate.
The most important thing to remember here is that as the executor, you may be personally liable for any successful claim. So, if there is any risk that a claim may be made seek advice from a local legal expert as soon as possible.
- Caveats over a Grant
When someone believes that you aren't the best person for the job or that the Will is valid, they can put what's called a caveat over the estate. A caveat is a court notice that prevents certain things from happening without informing the person requested the caveat.
5. Manage income tax affairs
Before you can finish your role as executor you need to tie up the deceased person's affairs with the Australian Taxation Office.
Follow these three steps:
- Register the deceased's death
Notify the Commissioner of Taxation that the deceased person has passed away.
- Lodge a final tax return
You only need to do this if the deceased person was earning an income above the tax-free threshold before they passed away.
- Lodge a 'trust tax return'
This is only necessary if the estate earns an income from when the person dies the final distribution of the assets.
We highly recommended that you work with a licensed accountant for this step.
6. Distribute assets
It's finally time to pass the assets on to their new owners. The deceased person will have, ideally, named who each of their assets will go to.
Before you distribute the assets, remember to first:
- ensure every asset is accounted for
- properly preserve every asset
- wait for any time limits, for anyone wanting to contest the Will, to pass
- close up shop with the ATO.
What rights do you have?
You have two main rights as an executor of an estate:
- the right to decline being executor.
Administering an estate can end up taking a lot of time. So, it's not surprising that you can access compensation for your efforts.
Once you've completed above six steps, you can apply for your 'executor's commission'. This commission is calculated as a percentage of the value of the estate. The percentage typically ranges between 0.5% to 3%, depending on the size of the estate and the amount of work required. The commission must be approved in writing either by the beneficiaries or the court.
Declining your right as executor
If you are named as an executor and you do not want this responsibility you don't have to go through with it.
If you decline, a different executor of the estate can take on your duties. If there isn’t another person named, you can apply to have a court-appointed administrator take the reins.
Do you have more questions about your new role? Contact us today. Our friendly team of lawyers can advise you on any questions around Wills, estates and trusts.
Need help administering a Will?
Feeling that being an executor of a Will is a bit overwhelming? Speak to one of our lawyers today.
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