Acting as an Executor of someone’s estate is admirable, but don’t think it comes without responsibilities, and I’m not just talking about the fact that you’re now responsible for obtaining probate and administering the estate, which includes its valuation; paying debts and taxes due; and finally distributing the residue in accordance with the wishes laid out in the deceased’s Will. Enough itself.
HMRC rules state that inheritance tax must be paid by the end of the sixth month after someone’s death, and charge interest on any amount due if not paid on time. Whilst simple estates should be able to be done and dusted within six months, more complex estates can take up to twelve, hence the coining of the phrase ‘probate year’.
Managing probate can be a drawn out multifaceted affair, compounded by incomplete records with surviving family members not always in the position, or the right frame of mind given their loss, to fill in the gaps. Add in tardy replies from a multitude of organisations holding the deceased’s assets and it’s easy to see from the outset that six months is a very tight deadline indeed.
Most executors will be blissfully (albeit temporarily) unaware that not only are they accountable for making sure the estate is administered and accounted for accurately, they could well be responsible for coming up with the cash needed to pay the tax bill. And that’s before any of the money in the estate is available.
Whilst uncommon, executors have been known to have to pay inheritance tax due out of their own pocket before the estate has been wrapped up, particularly where there are little or no cash assets in the estate available to use prior to probate being granted.
Since most people ask friends or family members to act as Executors, and those asked rarely take advice before accepting, it’s easy to see how the average lay person’s jaw hits the ground when they suddenly realize the task at hand.
A common theme in my articles is to ensure you get advice before agreeing to anything that involves a legal process, and in the event that you do, definitely get some advice as and when you need to step up.
This information provided in this article is not intended to constitute legal advice and each relationship breakdown requires careful consideration in our view by a fully qualified Solicitor before decisions are made and before you embark on a certain course of action.
Penn Chambers Solicitors
0207 183 1485