Duties Of A Personal Representative
A personal representative is a person responsible for dealing with the estate (possessions, property, shares, bank accounts, etc) of a deceased person.
A personal representative can also be known as an ‘executor’ or an ‘administrator.’ This role is referred to as an executor if the deceased left a Will or as an administrator if the deceased did not leave a Will (died intestate).
When a person dies their estate needs to be dealt with in accordance to certain rules and the assets divided between the beneficiaries. This is where the role of the personal representative comes in to force.
If there is no Will, there are specific rules as to who will be a beneficiary of the estate and who will be entitled to apply to be the administrator.
The personal representatives will need to establish what the value of the person’s estate was when they died by obtaining details of the amounts in their bank accounts and the value of all other assets and any debts that they may have.
Depending on the value of the estate, the personal representative must determine whether it is necessary to pay any inheritance tax. An individual can currently have an estate of £325,000 before having to pay inheritance tax.
A Grant of Representation provides authority to the personal representative to deal with the estate including selling any property and closing any accounts. A Grant of Representation is known as a Grant of Probate (where there is a Will) or a Grant of Letters of Administration (where there is no Will). If the person owns a property or has assets of over £5,000 then a Grant of Representation will be required. Some banks/building societies allow for amounts up to £30,000 without requiring a Grant.
Once the Grant has been received the personal representative has a duty to collect in the assets of the deceased, pay the liabilities and distribute the estate to the beneficiaries. They have many powers to assist them when dealing with an estate e.g. power to sell property, insure property and invest monies, etc.
All duties of the personal representative must be carried out with care (known as due diligence) in relation to creditors and beneficiaries. A personal representative is not bound to distribute the estate to the beneficiaries before the end of what is known as “the executor’s year” (one year from death) but should pay all debts as quickly as possible. However, this does not mean that they can hold on to the assets, especially if the estate is ready to be distributed to the beneficiaries.
A personal representative must keep estate accounts showing the value of the assets as at the date of death, the assets that are collected in, the liabilities of the estate and how the estate is to be distributed. The beneficiaries are entitled to see the estate accounts.
The duties and responsibilities of a personal representative are very important and can become very complex or onerous. We can assist in these circumstances and take the burden away from you.