What Does Executor Mean?
Executor means, or refers to, a job role that involves administering the estate of someone who has passed away. An executor is the person named in the Will who has the responsibility of dealing with the deceased’s estate. They are also responsible for applying for a Grant of Probate if required. Their role is to collect all of the assets, pay liabilities and distribute the estate to the beneficiaries.
What Does A Beneficiary Mean?
Beneficiary means, or refers to, a person who has been left something (cash or possession) in a Will. A beneficiary does not have a “job” like an executor and has little involvement in the administration process.
Can An Executor Also Be A Beneficiary in UK?
An executor can be a beneficiary in UK and quite often they are. It’s common for close family members to be named as both an executor and beneficiary in the Will. Spouses will often name each other as their executors but also as the sole inheritor of their estate. In order for an executor to inherit from a will, they must be named as beneficiary because an executor is not automatically entitled to inherit from the estate.
In UK, an executor can be a beneficiary but under no circumstances should they also be a witness to the Will in which they are named. Witnesses are supposed to be independent and impartial. A witness that is benefiting from the Will is not impartial. Witnessing a Will in which they are named means that they are no longer entitled to receive their inheritance. In the worst-case scenario, the Will can be rendered invalid because it was not executed correctly. This would render the estate intestate and it would be distributed according to the law and not the testator’s wishes.
Also Checkout: Reading A Will
Although an executor can also be a beneficiary in United Kingdom, it doesn’t change the role or responsibilities they have as an executor. Even though ultimately, they will be receiving the assets in the estate they must still handle those assets according to the law. The same legal processes apply these include following the instructions in the Will, administering the estate properly and applying for probate if necessary.
Executors have, what is called a “fiduciary duty” to act in good faith for the benefit of all concerned. Even more so when they are a beneficiary or are related to a beneficiary. This is to protect the interests of other beneficiaries that are not executors. A beneficiary does not have the same access to information about the estate’s assets and finances as an executor. Nor do they have the same authority to make decisions about the administration of the estate. Therefore, the executor’s duties to beneficiaries include making decisions and taking actions that protect and benefit all the beneficiaries and not just themselves.
The executor should be able to show that all their actions and motives are transparent, objective, and completely above reproach. Should the executor fail in these duties by not keeping proper records, mixing estate monies with their own, selling a property without a proper market valuation, beneficiaries have the right to hold them personally liable for any financial loss incurred. A claim can be made for up to six months after the Grant of Probate is issued.
A benefit of naming your executor as a beneficiary is that it provides them with the motivation and momentum needed to administer the estate quickly and responsibly. An executor with an interest in the estate has no incentive to drag their heels or cut corners. It is in their best interests to settle things quickly and with minimal loss to prevent their inheritance being affected. Research shows, they are more likely to shop around for the best prices for probate services. This can save the estate thousands of pounds in administrative costs.
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