The role of executor can be a time consuming, complicated and stressful job so it is not uncommon to feel that you should receive some compensation for taking on the work. However, executors are not automatically entitled to be paid for administering the estate.
Can executors claim for their time?
Non-professional executors cannot claim for their time spent on the estate administration. It would not be acceptable for an executor who is not an instructed professional to claim an “hourly rate” or a “minimum wage” to the estate for the time they spent administering it. The role of executor is an unpaid position so before accepting it should be considered whether it is viable to take on the task.
An example of what can and can’t be claimed as an expense would be if the executor was unwilling or unable to clear the deceased’s property and employed the services of a professional clearance company, the clearance company’s fees could be claimed back as an executor’s expense, the invoice or receipt from the company would be used as evidence to support this claim. An executor would not be able to charge the estate an hourly rate for their time spent personally clearing the property; this is because this work falls under their responsibilities as executor. If they decide to save money by doing it themselves rather than paying a professional, the money that has been saved should stay in the estate to be distributed to the chosen beneficiaries in the Will, they are not entitled to the money saved by undertaking the work themselves.
When can a non-professional be paid to be the executor?
An executor can also be named as a beneficiary of an estate. The testator may choose to leave a bequest or legacy to compensate for their time and effort but this would be up to the testator’s discretion. It is not mandatory that they are left a gift in the Will; it is a courtesy and should not be considered as “payment” or as an “executor fee” as an executor is not entitled to claim for their services from the estate.
How much should a testator leave to an executor?
If a testator does choose to leave the executor a gift in the Will it is entirely up to them what they think is an appropriate amount. A testator may choose to leave their executor a specific gift, a lump sum, or a share of the estate on the condition that they fulfil their duty.
Does a professional executor get paid?
A professional would be a solicitor, bank or other institution that has been named as executor in the Will in a professional capacity. If a professional has been named as the executor of a Will it is common for them to charge for their services. A professional would be providing a higher level of knowledge, expertise and protection and this is what entitles them to charge a fee.
Professionals are not paid to be the executor, but they are paid for their work in administrating the estate. This is because they are a professional providing a service and they have the knowledge and experience that a layman doesn’t.
However, if the beneficiaries do not agree with the proposed fees they are able to ask the professional to step down and renounce their position. This then entitles the next of kin to administer the estate either themselves, unpaid, or to instruct another professional to assist them, the cost of the professional’s services can be claimed from the estate.
What can an executor get paid for?
Just because an executor can’t charge an estate for their time and work doesn’t mean they have to foot the bill for costs incurred by administering the estate.
An executor is entitled to claim back expenses from the estate. Costs incurred by the estate that is paid by the executor from their own pocket can be claimed back as executor’s expenses. These expenses usually involve things like the grant of probate application fee, costs relating to the funeral and wake, utility bills for a temporary period etc. These are acceptable claims that can be made.
There are no strict rules in place as to what can and can’t be claimed as an executor’s expense. The decision on what is acceptable to be claimed can sometimes be left up to the executors and beneficiaries’ own discretion. Residual beneficiaries can raise concerns as to what expenses are being claimed or have been claimed upon seeing the estates accounts. To avoid disputes, if an expense is in the grey area as to whether it benefits the estate it is best to discuss it with the beneficiaries and ensure everyone is on the same page before things get out of hand.