When making a Will, the first thing that must be considered is who to appoint as the executor to administer the estate. The executor is responsible for dealing with financial institutions, business interests, the Australian tax office and everything in between. Fundamentally, they ensure the deceased's wishes are carried and this person's estate is looked after.
As the executor, this role represents a huge responsibility, but also reflects the huge trust the deceased felt with you. However, if this reflects a deep personal relationship, it can feel overwhelming to look after all the assets, navigate all the right documents, and liaise with financial institutions. There's also the added pressure that the executor is held personally liable for administering the estate in reasonable time. Today, we aim to take the stress out of these responsibilities- starting with a step-by-step guide of what to do. Starting with...
Before the executor can start the administration process, they must locate the original Will. The deceased may have told the executor where to find the Will before they died, in which case it should be easy to locate.
If the original Will cannot be easily located, then the executor will need to contact the deceased's bank, usual accountant or law firm, or the Public Trustee in the deceased's State to see if any of these places hold the original Will in their safe custody. A lawyer can also help with this step, as they have experience in contacting these types of organisations.
The main duty of an executor is to locate the deceased's assets, pay debts- including funeral expenses, Probate fees, credit card or mortgage. After dealing with the finances of bank accounts and tax returns, the executor must then distribute all other assets, personal effects and property to all the beneficiaries of the Will.
But where to start with all this administration? We break down how to handle the deceased person's estate into immediately after death, pre-Probate and post-Probate.
Locate the original Will
Organise and carry out funeral arrangements, as well as the burial or cremation
Obtain a death certificate
Notify asset holders (such as banks, share registries and super funds), utility providers, and government agencies
Redirect post and contact financial institutions to put a halt on any direct debits
Find and contact beneficiaries, and keep them updated on the estate administration process
Contact the deceased's asset holders (such as banks or the nursing home) to confirm the nature and value of the deceased's assets
Create an Inventory of Assets of the estate including all bank accounts, real estate, motor vehicles, shares, insurance policies, superannuation, outstanding employee entitlements and any personal and household effects
Create a list of any outstanding debts or liabilities the deceased had at the time they passed away, including all credit cards, household bills, and mortgages
Keep records of any financial transactions incurred during the estate administration process, so there is a clear record of estate funds being used post-death and the executor can be reimbursed for any funds spend on administering the estate
Apply for a Grant of Probate with the Supreme Court (if necessary)
Let the beneficiaries know that the Grant of Probate has been made
Provide certified copies of the Grant to all asset holders, and provide them with instructions to transfer or liquidate the deceased's assets in accordance with the terms of the Will (and in consultation with the beneficiaries)
Pay off any debts, taxes, bills and reimburse any funeral or legal costs incurred by the executor
Distribute the remainder of the estate to the beneficiaries, including paying any cash gifts or bequests, distributing personal possessions and establishing testamentary trusts (if included in the Will)
Obtain confirmation from beneficiaries that they received their entitlement under the Will
File an estate tax return, or final personal tax return for the deceased, if required
Are there any limitations or restrictions to an executor's duties?
By now you may be thinking an executor has unlimited control when it comes to administering an estate. Whilst being appointed as executor does enable certain powers and authority, it doesn't mean the executor can do anything they want with the estate or the deceased's assets.
The following list sets out some of the things an executor must not do when administering the estate:
Pay their own bills or debts out of the deceased's estate
Pay themselves money for acting as executor (if not permitted by the Will)
Make any changes to the deceased's Will (i.e., by handwriting on the Will or forging a new Will)
Lie to or mislead beneficiaries about the value of the estate
Provide the court with false evidence when applying for a Grant of Probate
Unduly pressure or threaten a beneficiary or other eligible person if they intend to contest the Will
If the executor abuses their duties or fails to act according to the Will-maker's wishes, their responsibilities can be rescinded. A beneficiary can contact the relevant Supreme Court to raise their concerns and apply to have the executor removed and replaced.
The executor of a Will does not have automatic access to the deceased's bank accounts. Once the Will-maker dies, the executor will need to contact the relevant financial institutions to be able to access funds so they can pay off debts and arrange the transfer of assets.
Most financial institutions have a process in place to deal with deceased estates. The executor will need to fill out paperwork, including a deceased customer notification form, to confirm the identity of the person who has died and get authorization to access the funds. The bank will need to see original versions or certified copies of the Will and death certificate, as well as the Grant of Probate (if applicable) before they approve access.
In some situations, the executor may need to set up a bank account in the name of the estate to fulfil their duties. Once this is done, funds can be transferred to the new estate account to pay off outstanding debts prior to distributing the remaining balance to beneficiaries.
Establishing an estate bank account can be very helpful if there are multiple accounts to be closed and consolidated, assets to be sold and liquidated, and/or a Refundable Accommodation Deposit payable to the estate.
This article is brought to you by Safewill's affiliate law firm, Safewill Legal.
If you have been appointed as Executor of a Will or are the next of kin for someone who has passed away without a Will, we're here to help.
Safewill Legal is Australia's most affordable fixed-fee Probate and Letters of Administration service. We charge one fixed fee to obtain a Grant of Probate or Letters of Administration, regardless of the size of the Estate.
Our local team can readily provide you with complimentary guidance about where to start. Reach out on our live chat or call us on 1300 942 586.
Disclaimer: The information contained in this guide is not intended to be a substitute for legal advice but as a basic guide to the application process. If you have concerns or queries you should consult a legal professional about your specific circumstances.