Those who are due to receive funds may be keen to find out how long they will have to wait. Estate administration can be a lengthy and complicated business and it is a good idea if the Executor or Administrator makes the beneficiaries aware early on that they may have to wait a considerable time for their money.
The Executor (or Administrator, if there was no Will) has to collect in the deceased’s assets and value them.
Debts need to be paid and any tax liabilities, to include Inheritance Tax, must be calculated and paid. There is usually the need to obtain a Grant of Probate or Letters of Administration from the Probate Registry. This gives official authority to deal with the deceased’s affairs on their behalf.
If there is property owned by the estate, this will need to be cleared and sold, which often takes many months. In some cases, for example, if a sale falls through and new buyers have to be found, it can take much longer than anticipated.
In respect of other assets, the right paperwork will be required by the asset holders, such as banks and share registrars, before funds will be released. If any of this documentation is missing or incomplete, this can also slow down the administration process.
Once all debts have been paid and assets collected in, the Executor or Administrator will need to prepare detailed estate accounts.
There can be personal liability for mistakes made in the administration and accounting process, so it is important that this is done competently and accurately. It is possible to appoint a professional to deal with the administration if you do not have anyone able or willing to take on the role. Alternatively, if you have been appointed as an Executor or Administrator, you can ask a solicitor to deal with the majority of the paperwork on your behalf, leaving you to sign off on the documentation.
When the Executor or Administrator is ready to distribute the estate to the beneficiaries, there is a strict order in which payments must be made.
Pecuniary legacies are paid first, ie. specified sums of money left to beneficiaries. Residuary legacies are paid after all other legacies. They constitute whatever portion of the estate that is left. In some cases, this can be much less than the deceased may have anticipated, for example, if large sums were paid out in care home fees. It could even be the case that there is no residuary estate. If the Executor or Administrator realises this early on, it is a good idea to warn the residuary beneficiaries of the situation as soon as possible.
Our experts are here to help… contact Cornerstone Wills today to discuss your circumstances on 01276 415835/6/7.