Death – Managing Estates, Wills & Insurance for others

Managing another’s will

A Will is a legal document that states how the deceased person’s belongings are to be distributed after their death. The information on this page has been taken from the Maurice Blackburn site. Their site provides information for each State of Australia.

What is your role as Executor?

The Executor of the Will is responsible for distributing the person’s assets to the people named in the Will. This happens after any debts are paid.

Your main role as executor is to represent the person who has passed away and wrap up all of their personal, financial and legal affairs. Ideally, this person will have explained how they’d like you to carry out your duties in their Will.

Generally, your role is pretty straightforward. Being appointed as an executor can even be seen as quite an honour. However, in some cases, like when a person hasn’t done a great job of their estate planning or neglected it entirely, estate administration can be a difficult, time-consuming and emotional process. Without the right support, that is. Plus, an executor can even be held liable for making certain mistakes when administering a Will.

Here is a list of the 6 main responsibilities you now have as an executor of a Will:

  1. apply for probate
  2. preserve the assets
  3. gather the estate assets and pay liabilities
  4. defend the estate during any legal proceedings
  5. manage the deceased person’s tax affairs
  6. distribute the assets.

1. Apply for probate

Before you can officially act as executor of a Will you first need to apply for a ‘Grant of Probate’ from the court.

Simply put, probate ensures the Will is valid and that you have the court’s permission to carry out your responsibilities as an executor.

If you are in NSW or VIC you can apply for probate online and we will manage the entire application process for you:

2. Preserve the assets of the estate

You now need to properly preserve and maintain the assets you found until you can distribute them.

This means that you have to:

  • Secure and insure any real estate or other property that belongs to the deceased person. You need to do this until the property is sold or ready for you to distribute.
  • Make sure that any cash remaining in the deceased person’s bank accounts is accruing interest.

We recommend you make this task a big priority. You want to do everything you can to prevent a personal claim bring made against you for making a mistake.

Our Wills and Estates experts are available to help you get this process started right away.

3. Gather the estate assets and pay liabilities

Correctly distributing the assets of the deceased person is probably your main responsibility. But, to do this properly (and legally), you first need to locate the assets.

Locating assets involves tracking down quite a few important documents. Some of the documents you might need include:

  • recent bank and credit card statements from the last two years
  • building society account statements
  • certificates of title for any real estate holdings
  • latest rates notices for any properties
  • mortgage documents
  • share and debenture investment certificates
  • life and other insurance policy documents
  • private insurance certificates (this may help pay for funeral expenses)
  • unpaid debt notices
  • registration papers and insurance documents for any owned or leased vehicles
  • funeral account details
  • any other documents you can find that specifically relate to the deceased person’s affairs.

4. Defend the estate during any legal proceedings

If someone decides they want to try and contest or hold up the Will in court, you have to step in and defend the estate. Your official title here is, ‘legal personal representative’.

While Will disputes heading to court is unlikely, they have been increasing in recent years. So, it’s important to be prepared.

To help prepare you, there are two main types of legal attacks you may have to face:

  • Family provision applications
    More commonly known as ‘contesting a Will‘, this attack is when a beneficiary of the Will wants an extra share of the estate.The most important thing to remember here is that as the executor, you may be personally liable for any successful claim. So, if there is any risk that a claim may be made seek advice from a local legal expert as soon as possible.
  • Caveats over a Grant
    When someone believes that you aren’t the best person for the job or that the Will is valid, they can put what’s called a caveat over the estate.  A caveat is a court notice that prevents certain things from happening without informing the person who requested the caveat.

5. Manage income tax affairs

Before you can finish your role as executor you need to tie up the deceased person’s affairs with the Australian Taxation Office.

Follow these three steps:

  1. Register the deceased’s death
    Notify the Commissioner of Taxation that the deceased person has passed away.
  2. Lodge a final tax return
    You only need to do this if the deceased person was earning an income above the tax-free threshold before they passed away.
  3. Lodge a ‘trust tax return’
    This is only necessary if the estate earns an income from when the person dies the final distribution of the assets.

We highly recommended that you work with a licensed accountant for this step.

6. Distribute assets

It’s finally time to pass the assets on to their new owners. The deceased person will have, ideally, named who each of their assets will go to.

Before you distribute the assets, remember to first:

  • ensure every asset is accounted for
  • properly preserve every asset
  • wait for any time limits, for anyone wanting to contest the Will, to pass
  • close up shop with the ATO.

Other things you may wish to do as the executor:

  • Return borrowed items like library books
  • Donate unwanted items to charity
  • Arrange to dispose of unwanted items which can’t be donated

Declining your right as executor

If you are named as an executor and you do not want this responsibility you don’t have to go through with it.

If you decline, a different executor of the estate can take on your duties. If there isn’t another person named, you can apply to have a court-appointed administrator take the reins.

What happens if someone dies without a will?

If the person has not left a Will, the estate is shared under a formula set by law. If there are no close relatives there is a chance the estate could be paid to a state or territory government.

This information is from Legal Aid Victoria. Processes are similar in all States, but please check with local authorities for information best suited for your situation.

If you die without a Will or your Will is not valid, then an application for a Grant of Letters of Administration will need to be made to the Supreme Court. In most instances, the grant is made to the next of kin of the deceased. For example, the spouse, domestic partner or a child of the deceased.

If the person died and left behind a partner, then all of the estate goes to them. If there were also children from another relationship then some of the estate may also go to those children, but this depends on how much money was left in the estate. This won’t happen unless there was about $500,000 in the estate after all debts and funeral expenses have been paid. Different rules apply if the person left behind more than one partner.

If the person had no partner or children then all the estate goes first to:

  • parents
  • then siblings
  • then grandparents
  • then uncles and aunts
  • then cousins.

The estate does not pass to the government unless there are no living relatives.