It is illegal for an executor to withhold money from a beneficiary in the UK. But that isn’t to say that beneficiaries receive what they are entitled to from a will via an executor instantly.
In fact, being an executor is a fairly complex role. It can take time to get permission, gather the assets, pay any debts, and finally distribute the deceased’s estate to the beneficiaries.
Here is everything you need to know about how long an executor can hold or withhold funds from beneficiaries named in a will:
Can An Executor Withhold Money From A Beneficiary In The UK?
No. However, an executor’s job is to retain the assets of the estate for a short period of time. They may need them in order to pay off debts such as private healthcare fees or rent, for example.
That said, an executor is not permitted to hold onto assets for any selfish reason.
The only circumstance where an executor might conceivably hold onto the assets is when the debts or fees the estate owes (including any to the executor themselves) total more than the value of the estate.
How Long Can An Executor Hold Funds In The UK?
Strictly speaking, there is a limit on how long an executor can hold assets from an estate in the UK before distributing them:
- 365 days – is technically the time limit, though it’s not usually strictly followed.
- 8-12 months – is the average length of time it takes an executor to settle an estate.
- More than a year – that said, complex estates often take longer than a year to settle even with the executors and all other parties proceeding actively and diligently.
What Does An Executor Do?
If you are concerned that an executor of a will you are a named beneficiary of is withholding money from you, do be aware that it could just be the demands of an executor’s role that are taking the time.
An executor’s job is relatively complicated. That’s why you should only agree to be the executor of someone’s will after careful consideration. An executor needs to:
1) Value The Estate
The first thing an executor needs to do is value the estate. This might include:
- Having property valued
- Locating all shares and investments the deceased owned
- Finding all bank accounts, pension funds and the like
- Gathering (and potentially valuing) any valuable personal possessions
- Discovering any outstanding debts
2) Pay Inheritance Tax
Once the value of the estate is known, the executor can calculate how much inheritance tax is due. This has to be paid (often from the estate) and submitted within 6 months of the death date.
3) Getting A Grant Of Probate
Only after inheritance tax has been paid can the executor acquire the legal right to actually do anything else with the deceased’s estate.
This right is called the Grant of Probate and must be applied for. This alone can take 3-6 months to acquire. Sometimes, it can take longer.
4) Locate And Bring Together Assets
The executor should hopefully already have located the deceased’s key assets so they can be valued as part of the estate. Now is usually the time when those assets are dealt with in accordance with the will.
This might mean bank accounts are closed. Or perhaps a property or shares are sold so the funds from their sale can be distributed.
This process can be all the more challenging if the deceased didn’t leave detailed records about what these assets are or how they can be accessed.
5) Settle Debts
Settling any debts that the estate owes may also cause a delay in an executor distributing money to a beneficiary even if they are not deliberately withholding.
This is because an executor needs to give a little bit of leeway to any creditors the deceased may have owed money to. If they distribute too soon and a creditor comes forward later, the executor will be left responsible for clearing the debt.
Needless to say, this is a poor reward for all the executor’s work so far.
6) Distribute Money To Beneficiaries
Again, delays can be caused by the need to locate all the named beneficiaries of the will before starting to distribute them.
This process can be easy or it can be more complicated. For example, imagine a relative named in the will has become estranged and emigrated to a different country.
What Do You Do If An Executor Is Refusing To Pay A Beneficiary?
The first thing to do if you believe an executor is refusing to pay a beneficiary is to contact them directly. Ask the executor what the delay is. It may be any of the reasons above – and many more besides!
Only if you are confident this isn’t the reason there is a delay in receiving any money or other assets you might be due from a will should you consider legal action.
The process for getting an executor to provide details of what they are doing is fairly simple. All you need is to get a court order. Finally, you can have an executor removed if there is evidence they are indeed actively withholding money from a beneficiary.
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