You have been named executor. Here is what the role requires.
We advise executors in NSW at each step, from the will to final distribution.
An executor is the person named in a will to manage the estate.
The role carries legal duties to the beneficiaries.
An executor who gets it wrong can be personally liable.
Administration often takes six to twelve months, and sometimes longer.
An executor's duties, step by step
- Locate the will. Find the original will and any codicils. You will need the original to apply for probate.
- Arrange the funeral. The executor is responsible for arranging the funeral and dealing with its costs.
- Notify organisations. Tell banks, financial institutions and government agencies of the death. The Australian Death Notification Service lets you notify a number of organisations at once.
- Identify assets and debts. Find, protect and list the assets. List all debts and expenses.
- Apply for probate. Usually within six months of the death, apply to the Supreme Court of NSW for a grant.
- Collect the assets. Once the grant is made, present it to banks and others holding estate assets.
- Pay debts and tax. Pay the debts and expenses of the estate. Lodge any final tax return for the deceased, covering the income year up to the date of death, and any earlier unlodged returns. Lodge trust tax returns for the estate's income until the estate is finalised.
- Wait before distributing. Do not distribute earlier than six months after the death. Consider publishing a notice of intended distribution.
- Distribute. Distribute the estate to the beneficiaries under the will.
- Keep records. Keep a record of every receipt and payment. Beneficiaries are entitled to an account of the administration.
Protecting yourself before you distribute
Section 93 of the Succession Act 2006 protects an executor who distributes after giving notice. In general terms, it applies where:
- The distribution is made at least six months after the death.
- A notice has been published inviting claims, giving a period of not less than 30 days.
- That period has expired.
- At the time of distribution, the executor has no notice of a family provision application or intended application.
If these are met and the distribution is properly made, the executor is generally not personally liable to a claimant who did not give notice in time.
The notice of intended distribution is published on the NSW Online Registry. Publication is not mandatory, but it can give this protection.
If a family provision claim is made, the executor should wait until the court resolves it.
Where executors get caught
The estate is distributed before tax is paid
The ATO advises finalising tax obligations before distributing. An executor who distributes first can be personally liable for tax owed.
The estate is distributed within six months of the death.
NSW law says an executor should not distribute earlier than six months after the death.
No notice of intended distribution is published.
Without it, the section 93 protection may not be available.
No records are kept.
Beneficiaries are entitled to an account of the administration. Record every receipt and payment from the start.
A claim is ignored.
If you know of a claim or intended claim, do not distribute the affected part of the estate.
Common questions
Can I refuse to be executor?
Yes, before a grant is made, by signing a renunciation. An executor cannot renounce once a grant has been made.
What if there is not enough money to pay all the debts?
Speak to a solicitor before you pay anyone. An executor who pays debts or distributes without accounting for all debts can be personally liable for the shortfall.
Do I have to lodge tax returns for the estate?
Possibly. The ATO may require a final return for the deceased and trust returns for the estate's income until it is finalised.
How long do I have to apply for probate?
An application should be filed within six months of the death. A later application must explain the delay.
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