Executors – Your Choice
Appointing executors through a will ensures your estate is administered according to your wishes, making it preferable to die with a will than without one. If you do not have a will, or if the will fails to appoint an executor (maybe because your chosen executor has died before you), then the law dictates that the person who can administer your estate will likely be one of the beneficiaries who is entitled to benefit from the main part of your estate namely a residuary beneficiary.
You have the choice on who to appoint as an executor. For many people there will be an obvious appointment – perhaps a spouse, or adult child(ren), a sibling or a close friend, or even a solicitor. For others, choosing an executor is a conundrum. So, lets have a think about the factors which may influence your decision.
1.
Who do you trust?
Your executors must carry out the wishes you have set out in your will and must preserve and look after your estate in the interest of all the beneficiaries. They will be entrusted with your most precious possessions, money and assets. And they will need to be in touch with your family and beneficiaries. Who do you trust the most to do this?
2.
Who has the ability and time?
To see to the above, the executors will need to visit your property to secure it. They will need to look for and locate your personal information, look into your finances and make sure everything is recorded and debts etc paid. This will include dealing with HMRC to make sure all your inheritance tax (if applicable) is paid. Can they work out if inheritance tax is due and then make arrangements to settle it? From 2027, pension funds will be considered as part of the estate which will be subject to inheritance tax and therefore the executors’ role will be more onerous as they will have to liaise with the trustees of such pension schemes to get valuations and pay the tax due. Extensive forms will need to be completed for HMRC, and if it is a taxable estate, interest runs on the inheritance tax due 6 months from the date of death so the executors must administer the estate in a timely fashion to avoid such interest becoming due. Do your executors have the time and the ability to see to this?
3.
Can your executors work with each other?
In some families some people do not see eye to eye. Maybe a simple personality clash, but sometimes a more deep-rooted and longstanding animosity and relationship fractures. It is imperative that your executors can work together. If they cannot, the administration will falter and will end up taking longer and could be costlier, which will impact the beneficiaries massively. It is not always a good idea to appoint the beneficiaries as executors either. It can work well and effectively but do consider if it would work better to choose an independent party. Remember, you can choose up to 4 executors. So, very simply, do ask yourself, do your executors get on with each other?
4.
Some practical considerations
Please consider the age of the executor you wish to appoint. They must be over 18 years old. But also, do ask yourself, are they likely to outlive you? Choosing a person in ill health as an executor would not be wise. Also, how will do they know you? Would they know how to arrange your funeral and what your personal preferences might be in relation to the estate administration – e.g. some simple things, like which charity would you prefer to take your clothes, would you want any food to be given to the food bank etc. You may also wish to consider the appointment of a professional executor such as a legal professional or your accountant, especially if your estate is complex, subject to inheritance tax, if there is a difficult family dynamic, or other special reason. People often ask if they need to permission of the person they are appointing, to appoint them. Whilst this is not strictly required, if would make sense to have their consent so you know they would be willing to accept the appointment.