Administration of Estates – distributing & finalising the estate

Having gone through all the steps in the earlier blogs in dealing with the administration of the estate, eventually it needs to be finalised and the matter closed.

The estate accounts need to be approved by the Residuary Beneficiaries and the tax matters closed with HM Revenue & Customs.

The assets need to be distributed to the Beneficiaries and the Executors need to obtain receipts for this. The Executors should give consideration to checking to make sure that the Beneficiaries are not bankrupt on the day of distribution, as the funds should be paid to the Trustee in Bankruptcy and it could create a liability for the Executors if they fail to use proper care and attention when dealing with an estate.

A child (someone under the age of 18) cannot give good receipt for a gift, so there needs to be a power to distribute and get good receipt from the parent – check the powers in the Will.

When the assets are distributed, as already mentioned in the income tax blog, the Beneficiaries are entitled to the tax paid and should be given an R185, signed by the Executor.

Once all the letters have been received to indicate that the assets have been gathered, the debts paid, the tax dealt with and the assets received by the Beneficiaries should store the information in a file for 7 years in case there is a claim on the estate for maladministration and they will have the evidence to show what happened.